Comment & Analysis
Cars are responsible for 12% of total EU emissions of carbon dioxide, the main greenhouse gas. To reduce this figure, EU legislation has set mandatory emission reduction targets for new cars.
By 2021, phased in from 2020, the fleet average to be achieved by all new cars is 95g/km of CO2 – the cornerstone of the strategy to improve the fuel economy of cars sold on the European market.
But while the target has been talked about for years, the reality is now quickly approaching, and many believe that the only way for the industry to comply with EU targets is to collaborate globally on standards for emissions regulations.
The idea to coordinate emissions procedures and protocols internationally isn’t new, but getting governments to cooperate poses challenges.
Dan Nicholson, president-elect of Fisita, the International Federation of Automotive Engineering Societies, and vice-president of global propulsion systems at General Motors, recently raised concerns about the EU emissions regulations.
“Complying with automotive emissions regulators is a tricky job,” he said, “and the differing procedures and protocols in various countries only make that challenge more difficult. If we can find a route to unify emissions procedures and protocols between the US, Europe, China, Japan and the other key geographic areas, we will directly reduce air pollution and lower development costs.”
However, implementing global standards for emissions might not be a viable solution just yet. PA Consulting Group’s annual forecast of European car manufacturers’ performance against mandatory CO2 emissions targets recently revealed that, among the large automotive OEMs, Volkswagen, BMW, Hyundai-Kia and Jaguar Land Rover will miss their 2021 goals, leaving them facing large fines and damage to their reputations.
Of the top 13 European OEMs’ performance against the emissions targets, the forecast shows that Peugeot Citroën remains at the top of the table, followed by Fiat Chrysler and Renault-Nissan, at number three, and Toyota, which remains in fourth place. These four OEMs, along with Volvo, all look set to meet their individual targets in 2021.
Hyundai-Kia was previously on course to meet its 2021 target, but has seen a dramatic decline in performance and is now likely to miss it. It was the only manufacturer to increase CO2 emissions, reflecting the fact that its petrol and diesel engines are not as efficient as those of its competitors, emitting 10g more CO2 than those from Ford.
The cost of these failures will be high, as the EU is planning to fine manufacturers €95 for every gram of CO2 above the company-specific target. Based on current sales forecasts, BMW will have to budget for €100 million in penalty payments, Hyundai-Kia for
€300 million and Volkswagen for around €1 billion.
While it seems that the only way forward towards reaching improved emissions numbers is through global regulations and standards, the struggle by many European manufacturers to reach their 2021 targets is already showing that the process is not going to be an easy one.