Auto industry groups said that a European Union aim to slash CO2 emissions from cars and vans by about 37.5 percent and 31 percent respectively by 2030 in comparison to 2021 levels would put a negative impact on the automotive jobs and consumer choice.

The EU governments and the European Parliament have agreed on the reduction decision, after finally settling things between the countries that produce vehicles and the environmentally-conscious lawmakers.

It was a tougher compromise as compared to the original EU executive proposal of 30% decline in emissions as compared to 2021. EU negotiators have also reached on an interim 15% CO2-cut target for cars and vans by 2025.

The alliance of 28 nations is highly fragmented for long time over how strictly they must follow the regulations on the CO2 emissions set as part of the initiative to alleviate greenhouse gases. Germany, the home to the largest auto sector in EU valuing approximately 423 billion euros in 2017, is concerned that the stern targets and the growing interest towards more electric cars are likely to hit its industry hard and could cost jobs.

The VDA auto industry association of Germany said that the latest regulations would set high demands while doing negligible in terms of providing incentives for shifting to electric vehicles.

The VDA head Bernhard Mattes mentioned that the negotiated deal is quite demanding. Mattes added that so far, nobody knows how they will achieve the negotiated limits in the given time.

The European auto industry’s lobby group ACEA has also expressed ‘serious concerns’ pertaining to the 2030 target as it finds a 37.5 percent CO2 reduction totally unrealistic, considering the present situation.

The EU’s existing average caps on CO2-emission from cars are 130 grams per km set for 2015 and 95g/km for 2021.

The recent deal has also disappointed Brussels-based Transport & Environment, a green lobbying group. Its clean vehicles director Greg Archer mentioned that Europe is seeking production of zero emission cars.

The agreement is yet to be approved by the member-country governments and the full EU Parliament, which are merely formalities. In a statement, Environment Minister Elisabeth Koestinger of Austria, who is also the current holder of the EU’s rotating presidency, said that the deal is a vital signal in their fight against climate change, calling the negotiations tough and intense.

The EU witnesses a sale of nearly 15 million autos every year. Electric vehicles have a market share of around 1.5 percent in Europe.

Published by Nikhil Kaitwade

With over 8 years of experience in market research and consulting industry, Nikhil has worked on more than 250 research assignments pertaining to chemicals, materials and energy sector. He has worked directly with about 35 reputed companies as lead consultant for plant expansion, product positioning, capacity factor analysis, new market/segment exploration, export market opportunity evaluation and sourcing strategies.

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