Can the automotive industry meet the new emission demands?

Just before the end of 2019, European Union governments reached a deal with the European Parliament on limiting carbon emissions on cars in a compromise that set a 37.5% reduction by 2030 on new vehicles. Days later, EU Environment Ministers called for truck CO2emissions to be reduced by 15% in 2025 and 30% in 2030, compared to 2019 levels.These are the EU’s latest measure over the past year to meet its commitments under the 2015 Paris climate change agreement, and it aims to support the shift towards electric vehicles and other alternatives. Yet there remain serious questions about whether automotive manufacturers can change fast enough.

The 37.5% compromise agreed on new cars on December 17 was exactly halfway between the EU member state target of a 35% carbon dioxide cut and Parliament’s 40%. Emissions from new vans will have to be 31% lower. There was also an interim target of a 15% cut for cars and vans by 2025.

“We are setting the right targets and incentives to tackle emissions,” said European Commissioner for Climate Action and Energy Miguel Arias Cañete. “It will help our industry to embrace innovation towards zero-emission mobility and further strengthen its global leadership in clean vehicles.”

Slow Uptake

But can the agreed limits be achieved in time? The agreement came in the face of furious opposition from Europe’s automotive industry, which said the commitment was driven purely by political motives and “totally unrealistic”. Erik Jonnaert, the secretary general of the European Automobile Manufacturers’ Association (ACEA), said the targets “will be extremely demanding on Europe’s automotive industry”, with a “seismic impact” on jobs.

The 30% vote by 2030 by Environment Ministers on trucks came just a few weeks after the European Parliament voted for at least 35%. These two figures will have to be reconciled in trialogue negotiations.

The two measures fit into the EU efforts to make its transport industry climate neutral by the second half of the century. The first step, policymakers say, is to reverse the rise in carbon emissions in EU’s transport sector, which increased by 28.3% between 1990 and 2016, according to the European Environment Agency.

However, carmakers have a point. Despite fiscal incentives and a new generation of models, the overall take-up of electric vehicles in Europe has been painfully slow: electrically chargeable vehicles made up just 1.5% of all cars sold in the EU last year, according to ACEA.

The technology is not moving fast enough either: while all major car and truck makers are investing in electric vehicles, they cannot eliminate emissions completely from the process. As German Economy Minister Peter Altmaier noted, “the compromise on CO2limits is at the limit of what is technically and economically possible.”

Moving in the same direction

There are also political pressures building up: the recent protests in France by the ‘gilets jaunes’ against rising fuel costs show that there is a limit to how much can be achieved through pricing.

On the other side of the argument, environmental campaigners say the measures do not go far enough. Transport and Environment, a green lobby group, says the emission cuts are not enough to limit climate change. “The new law means by 2030 around a third of new cars will be electric- or hydrogen-powered,” says Greg Archer, T&E’s clean vehicles director. “That’s progress but it’s not fast enough to hit our climate goals.”

Compromises by their nature never fully satisfy either side, and so it is with this. But while both the industry and campaigners each have their reasons to be unhappy, they are still moving in the same direction.