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CO2 emissions are increasing – car makers face high fines

This article was first published in German in Handelsblatt

Michael Schweikl, an automotive expert at PA Consulting, is quoted in an article which says that the auto industry needs an electric miracle to meet the EU requirements on CO2 emissions.

By 2021, average fleet emissions in the European Union are required to drop to 95 grams per kilometre. However, individual targets apply to each car manufacturer. For example, PSA must achieve 91.6 grams by 2021, while Jaguar Land Rover has to achieve 130.6 grams. According to PA Consulting, almost all manufacturers are about to miss their targets and face fines of over 14.5 billion euros.

For example, Volkswagen (VW) – the world's largest car manufacturer – has to cut emissions to 96.6 grams by 2021. According to PA’s research, VW will emit 109 grams of CO2 at that time, putting them in line for a fine of 4.5 billion euros. For BMW, PA Consulting expects fines of 754 million euros, while Daimler is just under one billion euros. Toyota has scored highest in the ranking, with the total fine of 18 million euros.

According to PA Consulting, car makers would need an “electric miracle” to avoid penalties. Around 2.5 million electric vehicles would need to be sold in 2020 – an increase of 1,280 per cent compared to current levels.

Michael Schweikl says that there are still opportunities for car manufacturers to reduce emissions and minimise future penalties. "But the urgency of the situation means they have to act quickly," adds Michael.

Above all, electric and hybrid vehicles would have to be cheaper. Mergers of car makers, such as Fiat Chrysler and PSA, can also help achieving this goal. And, according to PA Consulting, VW is on the right path with its development of open platforms, such as the modular electric construction kit.

Driving into a low emissions future: How can car makers look beyond 2021

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