European Policy

During 2009, the EU finalized CO₂ car targets based on car weight, part of an ambitious European energy and climate change package to which the industry will continue to contribute. The European auto industry is ready to meet the new law's standards for passenger cars, despite the sudden dramatic economic downturn that has severely limited the resources available to respond.

Under the new rules, manufacturers are required to ensure that the industry average fleet CO₂ emissions – for all the vehicles they make that are registered in the EU – are below 130 g/km. In 2012, 65 percent of each manufacturer's fleet must comply with this target. The percentage increases to 75 percent in 2013, 80 percent in 2014 and 100 percent in 2015. The long-term target for CO₂ emissions is set to 95 g/km; it will be reviewed again in 2013.

This approach gives the auto industry the necessary lead-time to adjust its development and production cycles to the legal requirements and to limit the financial risks caused by largely unpredictable factors, including consumer preferences, market trends, economic developments and legal requirements in different fields.

In some member states, CO₂ taxation is in place to encourage the early introduction of low-CO₂ vehicles with major tax break points, often around 100 g/km, 120 g/km and 160g/km. Unfortunately, these tax break points are not harmonized between the European countries.

Commercial vehicle targets have also been proposed of 175 g CO₂/km (with phase in during 2014 to 2016, with 75 percent of the fleet to comply in 2014, 80 percent in 2015 and 100 percent in 2016) and 135 g CO₂/km in 2020 for commercial vehicles. European policy makers are now urged to perform a thorough analysis of the proposal's impact on the economy, employment and the environment, in particular with regard to the long-term target.

The industry will continue to invest heavily in research and development and new product programs in order to reach the short-term targets. The long-term target will require technological breakthroughs, new refuelling infrastructure and a swift renewal of the car fleet on Europe's roads.