Head of Europe’s car parts suppliers accuses German car makers of ‘greed’

Differences are emerging between car makers and the suppliers of car parts over the EU’s efforts to fight climate change. While the car makers are continuing to oppose the EU’s proposed 2020 average carbon dioxide emissions limit of 95 grams per kilometre, the parts suppliers believe the target is easily achievable. The head of Europe’s umbrella organisation representing car parts suppliers has accused Germany’s car industry of ‘greed’ and ‘milking the cow dry’.

Discussions on firming up the 95 g/km target have already begun, a decision will be taken in the Summer. When the EU’s current target of 130g by 2015 was agreed in 2009, it made Europe the world’s leader in tackling climate-changing emissions from cars. But since then, the USA has set a standard of 70-80g for American cars to reach by 2025, and China and Japan are showing signs of matching the EU’s level, if not exceeding it.

Against this background, the intervention of Lars Holmqvist, the head of the European Association of Automotive Suppliers, Clepa, is significant, as it suggests the European automotive industry is split. Holmqvist told Reuters news agency the EU’s 95g/km goal is ‘not going to be any big hurdle [for most car brands], but it’ll be uncomfortable for some of the car makers’.

Holmqvist was particularly critical of Germany’s luxury car companies. ‘German car makers are a slightly different thing,’ he said. ‘They don’t seem to take the target seriously. They still live in a world where they think, “oh no, there will be a change”. Their reluctance is to a certain extent greed. For the moment, yes, there is a wonderful market out there in China, India, Russia, South America, for beautiful cars, from Germany mostly. They want to milk the cow dry, but that's very dangerous.’

Reuters says it asked Audi’s parent company, Volkswagen AG, to comment, but it declined.

Holmqvist also questioned whether the car industry is in as much of a crisis as it says. Referring to the $19 million compensation package earned by Fiat’s chief executive Sergio Marchione last year, Holmqvist said: ‘It is a lot of money if you’re in crisis.’

Last week representatives of the European car makers’ umbrella Acea had a meeting behind closed doors with Commission officials. Acea is reported to have said 95g by 2020 would be ‘extremely challenging’, but not everyone in the car-making industry agrees. ‘I think 95g is, for 2020, a value which can be reachable with today’s technology, without investing too much into electrical vehicles,’ said Stefan Jacoby, chief executive of the now Chinese-owned Volvo.

T&E and Greenpeace have written to the Commission present José Manuel Barroso, calling for the 95 g/km target not to be weakened and for the EU to set targets for 2025 that really move the car industry forwards. ‘The steps taken by the Obama administration turned the automotive crisis into an opportunity,’ the letter to Barroso said. ‘We believe the EU should adopt a similar strategy.’ The letter was prompted by calls from Acea for ‘a strong industrial policy’ – Greenpeace and T&E say any support for the automotive industry has to be conditional on a new generation of significantly cleaner vehicles.

Holmqvist says Clepa favours an 80g target for 2025, and for it to be agreed soon to give the automotive industry as much notice as possible. Clepa believes CO2 savings can be achieved with internal combustion engines as far as 70 g/km, but that lower targets than that would require different engines, such as electric and other ‘green’ technologies. The car parts industry employs about four times as many people as the car making industry.