Breaking the hold of the combustion engine over Europe

William Todts — May 31, 2022

Next week the EU Parliament votes on car CO2 standards. It could mark the end of vast oil imports and radically cut transport emissions.

As I write this, European leaders have just agreed to end imports of Russian oil, in a bid to starve the Russian war machine. Less than two weeks ago the EU executive published its plan to phase out all Russian fossil fuels by boosting renewables, electric fleets and efficiency. The Ukraine war, it seems, is accelerating the energy transition in Europe.

Or is it? Gas is still labelled a green fuel in the EU taxonomy. LNG is still promoted as a shipping fuel. Real change remains elusive. 

Next week’s pivotal car CO2 vote in the European Parliament is a case in point. The EU executive has proposed car CO2 standards that would require half of new car sales to be emissions free by 2030, and all of them in 2035. This would phase out Europe’s main source of oil demand: petrol and diesel cars.

It should be a no brainer for the EU Parliament to back this proposal. 

Apparently not. Next week’s vote pits a conservative bloc, led by Jens Gieseke, against a group of progressive lawmakers, led by Dutchman Jan Huitema. For now, the progressive bloc seems to have the upper hand but only ever so slightly. The main bone of contention is whether to fully phase out combustion engine cars, or to give them a lifeline beyond 2035.

Why is it so close? 

The EU’s plan clearly clashes with the interests (and profits) of engine suppliers like Bosch, Continental and Valeo. CLEPA, the trade body for enginemakers, has teamed up with the oil industry to fight rapid electrification calling for a shift to fantasy e-fuels and plug-in hybrids instead.

Legacy carmakers are divided. BMW, Stellantis and Toyota are vocally against the proposed CO2 standards, while Volkswagen and Mercedes are yet to express a clear position – in spite of all their ‘green’ commitments. Only Ford and Volvo Cars backed a recent letter supporting the 2035 phase out of polluting vehicles. 

This has created space for the car lobby, ACEA, to ferociously lobby against the 2035 phase-out. ACEA’s chair, BMW CEO Oliver Zipse, is going around calling the plan “dangerous” and “crazy”. The industry claims the switch to electric vehicles would destroy millions of jobs and make cars unaffordable. 

They claim going electric would make Europe dependent on raw materials sourced outside Europe – conveniently ignoring the fact that it is our 97% import dependence on Russian and Middle Eastern oil that threatens our security and prosperity.

Carmakers have made these kinds of arguments since the 1960s when they argued against catalytic converters, all the way through the 2000s when they said the EU car CO2 standards would make cars unaffordable. 

As before, the scaremongering is baseless. EVs and the energy transition are net job creators and EVs are already cheaper to own – no €2/litre fuel for EV drivers!

So, is this just a case of history repeating itself?

No, a profound change is underway. Tens of billions are being poured into the EV industry. Companies like Volkswagen went from being laggards to EV leaders. New players like Northvolt and Tesla, as well as mining, refining and charging companies, are investing and hiring as fast as they can. Even laggards BMW, Stellantis and Toyota have concluded that they must invest in attractive EV offerings or risk extinction. 

So, we’re in a situation where the “old” is dying but the “new” is only just being born. A victory next week in Parliament would not only mark the end of the emissions and oil imports associated with combustion engines, it would also accelerate the decline of the engine-oil power base in Europe. 

The European interest is clear. A vote in favour of phasing out oil and engines would make Europe independent of petro-dictators, radically cut transport emissions and create millions of new jobs. It is now up to members of the European Parliament to decide whether they cling to old idols or embrace the birth of a new, clean auto industry, and an energy independent Europe.

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