Luvly is still testing the Luvly O prototype but hopes to launch the car next year with a price tag of around €10,000 ($10,500), says Lutz. However, the microcar isn’t Luvly’s ultimate goal.

Stockholm-based startup Luvly is out to prove that bigger isn’t always better with its debut flat-pack electric microcar, which it says cuts carbon emissions and makes cities safer. Size matters ...