Climate Change Policy and Partnerships

During 2012, the climate change policy landscape continued to evolve. In the U.S., the Environmental Protection Agency (EPA) and the National Highway Traffic Safety Administration (NHTSA) finalized regulations on a national approach to vehicle greenhouse gas and fuel economy standards for 2017–2025. Globally, however, growing budget deficits at national and regional levels have overshadowed climate policy discussions over the last several years.

Our global approach to product planning and policy participation is based on the science of climate stabilization. We accept that simply “not getting worse” is not good enough. The auto industry must work together with suppliers, government, the fuel industry and consumers to reduce carbon dioxide (CO₂) levels from transportation so we can help stabilize atmospheric CO₂ concentrations. Stabilizing CO₂ concentrations will require that all sectors of the economy, including the transportation sector, do their share. Ultimately, to achieve real and lasting results, all global stakeholders must also make long-term commitments for a sustainable future.

In our major markets, the regulation of fuel economy and/or vehicle CO₂ emissions is becoming increasingly complex. In addition to competing federal and regional regulations, governments are taking diverse approaches to incentives for emission reductions through rebates, fees, “feebates,” privileges for low-emitting vehicles and penalties for high-emitting vehicles. At the same time, some state governments are introducing registration taxes on the same advanced vehicle technologies that assist in CO₂ reductions, to make up for the loss in tax revenues resulting from these vehicles’ reduced use of conventional fuels. This very complex policy environment is one important driver of our strategy to develop fuel-efficient and advanced technology platforms that can be shared globally and tailored to the needs of our customers. Customer vehicle-purchasing choices are affected by vehicle incentives, fuel costs, annual registration costs as well as overall maintenance and ownership costs.

In the U.S. and elsewhere, Ford continues to advocate for comprehensive, market-based policy approaches that will provide a coherent framework for greenhouse gas (GHG) emission reductions, so that companies have a clear understanding of their role in achieving reductions. GHG regulations effectively regulate what vehicles we are allowed to build and sell. CO₂ emissions standards for motor vehicles are functionally equivalent to fuel economy standards, because the amount of CO₂ produced by a vehicle is proportional to the amount of fuel used.

We hope that the information that follows helps to illustrate the diverse array of GHG and fuel economy regulations and incentives that are now shaping our markets. This section provides more detail on developments and Ford’s involvement in:

The map below provides a summary of the existing and proposed CO₂ emission and fuel consumption requirements and standards that vehicle manufacturers face across the globe. For each country the primary metric used in the regulation is listed, such as miles per gallon or grams of CO₂ per mile, as well as the “drive cycle” or vehicle testing process required to calculate compliance with the requirement. The map illustrates that many countries have existing or proposed CO₂ or fuel consumption requirements and that these requirements vary considerably by country and region.