Car-hire giants in U-turn over electric fleet

A pressure group has now accused Paris city hall of organising unfair and publicly subsidised competition

A pioneering scheme to provide cheap, "help yourself" electric cars for Parisian residents and tourists faces a last-minute legal challenge from the traditional car-rental industry.

The first 700 Autolib' cars – based on the city's successful bicycle self-hire operation, which inspired a similar scene in London – will appear in the French capital from December at a modest €5 (£4.40) for the first 30 minutes.

But a pressure group representing large car-rental firms such as Avis and Hertz has belatedly accused city hall of organising unfair and publicly subsidised competition. The administrative tribunal, which hears complaints against public authorities, must decide within weeks whether to abolish the scheme in its present form.

Manufacture of the first Autolib' cars – roughly the size of a Twingo or Mini, and with a battery life of 250 kilometres – has already begun in Turin. The Socialist Mayor of Paris, Bertrand Delanoë, is convinced that the scheme will be a popular and groundbreaking success like his do-it-yourself bike-hire programme, Vélib'.

The small, blue four-seater cars will be available from street or underground docking stations for €5 for the first half-hour for Parisian residents and €7 for visitors. As with the Vélib' bike scheme, long-term rentals will be more expensive. The idea is to offer a "green", cheap alternative for cross-town journeys.

Joining the scheme will cost a further €10 a day, €15 a week or €144 a year. "Autolibbeurs" will use a credit card to pick up a car from a docking station and leave it in a spare place at any other station when finished. Each car will have a radio, a GPS route-finding system and an onboard computer to direct the driver to empty docking spaces.