Merkel fights German carmakers’ battle

But T&E report shows her fight is unnecessary

Germany’s luxury carmakers are raising the stakes in their battle to weaken EU legislation that will set fuel consumption limits for new cars made after 2020. The German chancellor Angela Merkel used a speech at this month’s Frankfurt motor show to say that strict limits would damage European carmakers’ competitiveness in global markets. Yet T&E’s eighth annual Cars & CO2 report shows that EU legislation is speeding up improvements to fuel efficiency, which in turn leads to drivers saving money at the fuel pump.

The EU’s first legislation forcing carmakers to limit the amount of carbon dioxide emitted from the average new car sets a target of 130g/km of CO2 to be achieved by 2015. The next target is 95g/km for 2020, but an agreement on how to achieve this was obstructed by Germany in June, following massive pressure on Merkel by the country’s premium carmakers, who in turn put pressure on the Irish presidency of the EU. German carmakers want a more generous ‘super-credits’ scheme that will allow them to produce more high-consumption cars in return for producing a few electric vehicles.
 
Speaking in Frankfurt just weeks before her party’s success in the German federal elections, Merkel said: ‘Europe must learn that we are not an isolated continent but that we must succeed in global competition. We need to look beyond our borders – push for open and free trade, but at the same time not impose greater burdens on our industry than other continents do with their own industry.’
 
Yet the latest T&E report detailing individual carmakers’ performance on reducing emissions shows that the annual rate of progress has tripled since the EU legislation was agreed in 2008 and that most carmakers are on track to achieve their targets.
 
The progress being made could slow down, however, if Germany’s demands for more super-credits for electric cars are accepted. The report shows that super-credits awarded to Nissan for selling just 2800 electric cars in 2012 effectively reduced its target by 2g/km. From this, the report calculates that, with current trends in sales of electric cars, super-credits would totally undermine the 95g/km target for 2020 and result in it being met on paper but not on the road.
 
Luxury German carmakers have also been putting pressure on their alliance partners to re-open negotiations on the deal. T&E has learned Opel has recruited Peugeot-Citroën, and that Daimler has secured the support of Nissan-Renault in their attempts to get France to support the German position. But during a discussion among ministers, held at the request of Germany, no country supported its calls to block the deal. The UK and Poland appear to be the latest countries to reject German attempts, and France is therefore the Germans’ last hope for support.
 
‘Germany is still as isolated as it ever was,’ said T&E’s clean vehicles manager Greg Archer. ‘Now that the German election is over we hope Chancellor Merkel will accept the agreed deal for 2020. Volkswagen has confirmed it can meet 95g without any super-credits and Daimler’s development chief has also said it will meet its target. Caving in to the short-term interests of luxury car brands will just add costs to motorists’ future fuel bills, send more EU money overseas to buy oil and increase emissions.’