New figures show car manufacturers failing on CO2

European car makers are falling further behind on their voluntary commitment to cut carbon dioxide emissions from new cars.

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A report in the Financial Times published last month said the Commission will soon publish figures showing Europe’s manufacturers cut average new car emissions by just 1.8% to 160 g/km last year. To reach their target of 140 g/km by 2008, an annual improvement rate of 3.3% is needed.

Ivan Hodac, secretary general of the European Association of Automobile Manufacturers (ACEA) said: “It is correct that more efforts will have to be made. The road ahead is difficult. But there is absolutely no reason to conclude today that we will not reach the target.”

T&E director Jos Dings said: “Rather than living in denial about its failure, the industry should now accept a legally binding, flexible and transparent system as the best solution for all concerned.”

The car makers’ strategy appears to be hitting their profits as oil prices have increased. In America, sales of the largest 4x4 vehicles have fallen in recent months, and General Motors and Ford, who rely for much of their profits on 4x4 vehicle sales, both had their credit rating reduced to “junk” status last month. GM reported a $1.1bn loss in the first quarter of 2005, and Ford’s profits were also down.

Meanwhile Toyota, whose emphasis on fuel efficient technologies has contributed to big profits, has said it will begin building a hybrid version of its best-selling Camry saloon car in America from next year – the first time the company’s hybrids have been built outside Japan.

Ford also suffered the first case of high-profile direct action from environmental campaigners last month when protesters from the British branch of Greenpeace stopped production at Ford’s Range Rover factory, declaring it a “climate crime scene”. And earlier this month the protestors continued their campaign by attempting to disrupt sales of Land Rovers across the country.

Buyers of such vehicles in Great Britain may soon face substantially higher taxes if proposals from a UK government agency get the green light. It says the only way to force motorists to buy “green” cars is to introduce a new top rate of road tax of €1315 a year, more than five times the current top rate in Britain of €241 a year for petrol engines. The agency also calls on ministers to make the most fuel-efficient cars tax-free or to offer a tax rebate as an incentive.

This news story is taken from the June 2005 edition of T&E Bulletin.