Renault vice president Patrick Pelata has warned that demands for cars with low CO2 emissions will push prices up and sales volumes down.

In an interview with the German car magazine, Auto Motor und Sport, he said that the industry will need to make enormous changes to car designs that will push costs and prices up. “We reckon that if prices in Europe go up 10%, demand will fall by 15-20%.

Pelata added that Renault is hoping to position the brand more upscale and launch more luxury car models – practical high quality cars at fair prices.

The new image is expected to be developed when Renault launches the redesigned Laguna this September. The model has the job of improving the image of the Renault brand, said Pelata.