Radical new Renault Clio hybrid to keep costs down

The Clio was updated in 2023 with a new look, revised trim structure and improved technology, and Autocar understands that Renault is likely to heavily update the current, fifth-generation car again in around two years’ time. 

Beyond that, plans are taking shape to introduce a completely new model in the second half of the decade that will take the Clio name into its fifth decade with a bold new look and highly advanced interior technology, but it will have a rigid focus on affordability – and still be powered by petrol. 

Renault product performance boss Bruno Vanel outlined to Autocar the brand’s plan to renew its line-up of entry-level cars, now that it has fleshed out an expanded range of larger, C-segment models, comprising the Mégane, Scenic, Austral, Rafale and Espace.

Those models are important, he said, because of the huge popularity of such cars in Europe and the higher margins they can command, but “it doesn’t mean we’ll forget about the B-segment”.

He pointed to the upcoming 4 crossover and 5 supermini as evidence of Renault’s commitment to small cars but he was quick to suggest that neither is intended as a replacement for the brand’s 34-year-old hatchback.

“Clio is a brand in itself,” said Vanel. “In the UK, it is probably as well known as Renault – or even more.”

Renault’s recognition of the importance of the Clio name ties into its decision to also retain the Mégane, Scenic and Twingo monikers as it electrifies. 

The Clio’s future had looked uncertain beyond the current generation, given the upcoming arrival of the similarly sized 4 and 5 EVs in 2024, and the electric Twingo is planned to roughly match the Clio for price when it comes in 2026.

But Vanel said keeping the small petrol hatchback – currently priced at just under £18,000 – is important because it provides customers with choice, while ensuring Renault does not abandon a large proportion of its customer base as it introduces a range of more costly EVs. The Mégane E-Tech hatchback, for example, is double that price.

“We are not moving directly towards 100% electric,” said Vanel. “We are doing it step by step, to have this transition with hybrid cars so that we remain an affordable brand.”

Facilitating this push for affordability is the fact that Renault is able to sell combustion cars until 2035 in the European Union and – in accordance with the government’s recently relaxed decarbonisation timeline – the UK. 

As a result, the new Clio is set to be sold with an evolved version of the petrol-electric E-Tech powertrain used in the current car, combining a naturally aspirated four-cylinder engine with an electric motor, a starter-generator and a small-capacity battery for low combined emissions and the ability to drive small distances with the engine off. No doubt the need to reduce emissions across its line-up will mean Renault phases out the cheapest, pure-petrol variant of the Clio for the next generation.

Logically, the fact that Renault’s CMF-BEV platform for small electric cars is so closely related to the Clio’s CMF-B architecture means there is potential for an electric derivative down the line, but Autocar understands it is not yet planned.

The brand will need to carefully consider the Clio’s positioning if it is to become part of its EV range alongside the 4 and 5. Vanel said the firm ultimately wants customers to decide whether to make the switch from the Clio to the 5.

He said: “We want to make it an easy decision, but we want them to make the decision when they are mature for that and when the market is mature – when there are enough charging stations and it’s reasonable to do so.”

Renault Group CEO Luca de Meo is a vocal advocate of small, affordable cars. Speaking recently in his role as chairman of European motor industry body ACEA, he rallied against the increasing difficulty of selling such cars profitably, because safety and emissions regulations have driven up production and development costs to unprecedented levels.

“A- and B-segment cars are not profitable any more because auto makers have to produce cars dressed up like Christmas trees,” he said. “It doesn’t make a difference if it’s a Clio or a big limo.”

The Clio’s cause will have been helped in this regard by two significant regulatory developments: the EU’s and the UK’s decision to allow new combustion car sales for another 11 years and, just as importantly, the slackening of impending Euro 7 emissions rules. It has already been suggested that the fate of two of the Clio’s biggest rivals, the Skoda Fabia and Volkswagen Polo, was contingent on Euro 7 requirements being relaxed. Initial proposals for the rule set would have imposed such heavy production costs on the cars that the margins would have made them unviable.

No doubt Renault bosses also see an opportunity to carve out a bigger share of the supermini market now that the once-dominant Ford Fiesta has been retired.

Crucial to the success of the Clio will be Renault's ability to maintain competitive structures – an endeavour that, said Vanel, will focus less on outright total cost and more on monthly payments.

“We will try to keep the affordability of the monthly rentals,” he said. “If you compare the rentals in 2018/2019 to last year [2022], with the improvement of residual values and even with some price increases, I think we experienced quite a good performance there, which kept the affordability safe.

“This is something which we are looking at a lot, so that for the customers, the monthly rentals – leasing, PCP or whatever – remains quite stable, or in the same region.”

Vanel also suggested that avoiding discounting – in line with Renault’s ‘value over volume’ ethos – is also playing a role in supporting strong residuals, thereby keeping monthly payments stable.

Vanel hinted at plans to introduce much more flexible payment schemes – potentially on a per-use basis – for the Clio and other future Renault models, via new mobility brand Mobilize.

He said: “That’s what people expect. Mobilize has acquired a company [Lease&Co] which is exclusively focused on subscription schemes, so that’s something which we are definitely in. We try to give more flexibility to our customers going forward – leasing solutions for the moment, but exploring with this subsidiary the way we could go for more flexible schemes.”

Opinion: Keeping the Clio small is a win for common sense

Once right at the heart of arguably the most crowded, competitive segment of all, the Renault Clio increasingly feels like an anachronistic outsider: a family-friendly, comparatively affordable and petrol-powered supermini.

Surely, then, it’s time to reinvent the Clio as an EV and/or a crossover?

Thankfully not: while Renault isn’t exactly shy about turning classic models into EVs, the Clio is set to remain a bastion of cost-effective ICE-based motoring for buyers who want a little more premium sheen than Renault sibling brand Dacia can offer.

At a time of much change, it will ensure welcome options for car buyers in a time of transition.