EU Automotive Makers are Faced with Challenge in Bid of Electrification
The European carmakers are fighting a war against time as they have waited until the last minute to try to meet ambitious EU emissions targets and would face billions in fines if they fail to comply.
- From 2021, phased in from 2020, the EU fleet-wide average emission target for new cars will be 95 g CO2/km.
- This emission level corresponds to fuel consumption of around 4.1 l/100 km of petrol or 3.6 l/100 km of diesel.
These binding emission targets for manufacturers are set according to the average mass of their vehicles, using a limit value curve. This means that manufacturers of heavier cars are allowed higher emissions than manufacturers of lighter cars.
If the average CO2 emissions of a manufacturer’s fleet exceed its target in a given year, the manufacturer is required to pay an excess emissions premium for each car registered.
Why things have become worse for Car Makers?
The up-gradation of the technology to comply with the norms will cost an extra 10,000 euros to build, fleet-emissions targets requiring a certain sales volume and consumers who may or may not want them.
The cost of pushing technology coupled with unconvinced consumers could hamper profits in the industry which is already suffering a downturn in sales
The timing has also come as a disguise due to the decline in the world’s main auto markets and the sector is bracing up for a chaotic British exit from the European Union as well as a protracted U.S-China trade war.