The automotive industry is facing a pressing deadline – by December 31, EU car manufacturers must meet CO2 emissions targets of 95g/km for new passenger cars, and 147g/km for new light commercial vehicles.
The regulation contributes to the binding target of a 40% reduction in greenhouse gas emissions by 2030 and forms part of the EU’s mission to become carbon-neutral by 2050.
With cars responsible for approximately 12% of the EU’s CO2 emissions, every step taken towards meeting these regulations is vital. And one need only look at the increase in electric vehicles and green incentives to see that car makers are committed to achieving these goals.
Despite positive progress being made by car manufacturers, in 2019 the gap between the 2021 target and the average CO2 emissions produced by passenger cars was 27.2 g/km – indicating that the industry is still quite a long way from meeting the targets set.
In 2014, a big step toward cutting emissions was taken by the United Nations Economic Commission for Europe through the development of the Worldwide Harmonised Light Vehicle Test Procedure (WLTP). Created to more accurately measure fuel consumption and emissions from new vehicles, WLTP calculations allow local governments to determine how much tax a vehicle will be charged and offer a clear incentive – the lower the emissions, the lower the taxation.
With average new car emissions data being measured under the WLTP system (which has increased CO2 figures versus the previous NEDC method), we anticipate that its full implementation, alongside potential government taxation policies, will be critical for helping manufacturers meet impending CO2 targets. As car makers act to avoid fines from the European Commission, we believe we will see a number of positive changes across the industry, in further support of global climate change objectives.
Once WLTP-driven policies are implemented, manufacturers’ abilities to provide consumers with numerous add-ons (options) and design amendments will become increasingly difficult as each product contributes differently towards WLTP values.
In the short-term, manufacturers may begin to adjust the features available or package them together so there are fewer variables to measure – in fact, we have seen this trend already begin among a number of car makers.
As add-on features contribute to CO2 levels emitted by vehicles (causing higher levels of taxation) there may also be
a shift in consumer preferences, allowing motorists to make more informed decisions when considering the CO2 impact of their new car.
We predict there will be a transition in consumer preference towards greener extras, such as low-rolling-resistance tyres and alloy wheels that cause less air resistance.
THE ROAD TO NET ZERO
Although there are clear challenges ahead in terms of achieving net zero-emissions, we believe that the CO2 targets may alter consumer preferences even further, particularly because taxation will be used by governments to steer customers and fleet owners towards greener transport solutions.
Following the complete implementation, we believe there will be an outstanding growth in electric vehicles, alongside new add-ons and eco-friendly features. And fleets and buyers outside of Europe will begin to follow suit and take a greater steer on emissions.
Since 2014, WLTP has been working away in the background, undergoing scrutiny and testing. However, car manufacturers have spent vast sums of money in order to meet one of their biggest challenges yet – migrating to new technologies and developing models that are less reliant on fossil fuels.
For this reason, many will welcome the arrival of WLTP, because its more realistic representation of vehicle efficiency will illuminate the true barriers facing emissions reductions. Once WLTP is fully implemented across Europe, vehicles that do not comply with these goals will be exposed, subject to large fines and objections.
We are sure that WLTP implementation will give the automotive industry the final push it needs to meet CO2 regulations once and for all.
Olivier Peijs, head of European sales & leasing, Jato Dynamics