Frost & Sullivan Projects That About 80% of European Vehicle Sales Will Be in the <150 g/km CO2 Band by 2015; EVs as a Strategy of Premium Automakers
18 January 2010
A new report from Frost & Sullivan, Implementation Roadmap of CO2 Tax Banding in European Countries and Impact Analysis on Powertrain and Green Technology Adoption, finds that about 80% of the European vehicle sales is expected to be in the less than 150 g/km CO2 emission band by 2015. The countries covered in this research service are Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom.
European automakers are striving to comply with EU CO2 norms (average fleet emissions less than 130 g/km by 2015) to avoid penalties. (As a point of comparison, the US EPA’s proposed national CO2 emissions standards for light-duty vehicles under section 202 (a) of the Clean Air Act would require these vehicles to meet an estimated combined average emissions level of 250 grams/mile of CO2—155.26 g/km—in model year 2016. Earlier post.) Key elements of the CO2 regulations for passenger cars include:
Total reduction in average CO2 emissions from new cars to 120 g/km, with 10g/km to come from non-vehicle technologies and measures, such as a greater penetration of biofuels.
Staggered implementation: 65% to comply with requirements in 2012; 75% in 2013; 80% in 2014 and 100% in 2015.
Eco-innovations will count for up to 7 grams of manufacturers’ fleet targets.
Super-credits are awarded for vehicles emitting less than 50 g CO2/km.
Penalties will be imposed on a sliding scale; manufacturers exceeding their target by more than 3 g/km will pay €95 (US$137) per excess gram per vehicle. Smaller charges between €5 and €25 for excesses of 1 – 3 g/km.
- Provisions for niche manufacturers (10,000 to 300,000 units) to achieve fleet average reduction of 25%.
In 2014, any weight increase in new cars will be studied. Following review, CO2 targets may be adjusted in 2016, to be reviewed every three years.
Average new car CO2 emissions should fall to 95 g/km in 2020, following a thorough assessment of this target’s expected overall impact.
The European Automobile Manufacturers’s Association (ACEA) says that its members have introduced more than 50 new technologies in their vehicles over the last 10 years to reduce CO2. ACEA says that the industry spends €20 billion (US$28.8 billion) annually—4% of its turnover—on R&D with much of this spending contributes to reducing the environmental impact of cars, including CO2 emissions.
By 2015, the average car in Europe will be 5 per cent lighter, with 30 per cent lower CO2 emissions. Downsizing, gasoline direct injection (GDI), and start-stop will be the key technologies helping original equipment manufacturers (OEMs) achieve emission targets by 2015.
—Frost & Sullivan Program Manager Vigneshwaran Chandran
About 8-10 million cars are expected to be in the less than 120g/km CO2 emission band in Europe by 2015—a significantly attractive market opportunity for both volume and premium manufacturers.
While VMs invest heavily in the development of new low-CO2 models and engine variants, it is challenging to pass on these costs on to the customer, risking the OEMs’ profitability, the report says.
Offsetting the high development costs for green technologies and time for returns-on-investment on certain expensive developments such as gasoline direct injection and hybridization will be a key commercial challenge for automakers.
—Frost & Sullivan analyst Hariher Balasubramanian
Subsequently, automakers will likely employ different strategies for emission reduction, with mass manufacturers adopting moderate downsizing and technologies like variable valve train (VVT) and GDI. On the other hand, premium automakers will invest significantly on aggressive engine downsizing by more than 20%, combined with full hybridization, according to the analysis.
Premium manufacturers such as Daimler and BMW are likely to use a combination of electric vehicles, hybridization, and downsizing to achieve their 2015 CO2 emission target of 130 g/km, while volume manufacturers will use a mix of green technologies such as GDI, VVT and start-stop systems.
—Hariher Balasubramanian
Implementation Roadmap of CO2 Tax Banding in European Countries and Impact Analysis on Powertrain and Green Technology Adoption is part of the Automotive & Transportation Growth Partnership Services program, which also includes research in the following markets: 360 Degree Analysis of the European Powertrain Market for Passenger Vehicles, Executive Analysis of the European Light Commercial Vehicles Powertrain Market, and Global Hybrid and Electric Vehicles Database.
Europe is insistent on chasing after the non-necessary, to the detriment of actually addressing the necessary.
Emissions of truly unquestionable, toxic, materials like CO, HVOCs, SOx and NOx is ignored, while the EU chases after the ephemeral and probably unnecessary reduction in CO2. It choses to fight against a hypothetical threat that would only affect mankind a few centuries from now at the earliest. Meanwhile it accepts increasingly dirty air, that is a genuine, unquestioned, health threat yesterday, today and tomorrow. Europe's air in its cities grows dirtier, while North American air in its cities, grows cleaner and healthier.
But Europe is a producer of both genuine toxic emissions, but also significant amounts of CO2, on net too. North American cars benefit from the plethora of other CO2 mitigation that occurs, to the point that North America does not need to be as concerned with CO2 emissions, since it is already a null producer of CO2, and the continent is a net CO2 sink. Essentially CO2 control has been achieved, to all intents and purposes, and is no longer a problem.
So it can fully address the genuine, unquestioned, toxic air emissions. It has done so to the point that its ICEs are genuine Zero Emission vehicles, ZEVs. These ICEs, equipped with North American ICE cleanup technology, achieve a degree of emission cleanliness, unanticipated to ever be achieved. Modern North American ICE engines actually create cleaner air than ambient air; in even air deemed clean, in air quality attainment areas. They now achieve the air quality that was originally thought could only be achieved with FCEVs or BEVs.
Posted by: Stan Peterson | 18 January 2010 at 08:48 AM
Stan says a lot of unfounded allegations. Wonder where he gets such fallacies.
When you drive a Hummer like vehicle using liquid fuel extracted from dirty Alberta tar sands (at the rate of 1,200,000+ barrel/day), you create many times the pollution per Km than when Europeans drive one of their small much cleaner car.
Secondly we drive more Km per capita than EU does.
Thridly, our pollution per capita is about twice as high as the average EU country.
Posted by: HarveyD | 18 January 2010 at 09:37 AM
The report is actually about the expected consequences of tax policies. Want less production of CO2? Then tax it heavily.
It is hardly rocket science to forecast that premium autos will feature premium systems for reducing emissions. And lower cost autos will be different.
Premium autos are built differently because they are intended to seem different, better, and exclusive. Sometimes the "better" part isn't quite true but the different and exclusive can be relied upon.
I believe you can already buy some very uber-modern systems on high-end Mercedes. Just show them the money.
Posted by: Ken | 18 January 2010 at 12:38 PM
I suggested some time back that the luxury segment should be forced to adopt the best high-efficiency technologies first, as that's where the money is.
Looks like Europe got there first. I feel like Deming, ignored in the USA but with a huge following in Japan.
Posted by: Engineer-Poet | 18 January 2010 at 02:18 PM
I suggested some time back that the luxury segment should be forced to adopt the best high-efficiency technologies first, as that's where the money is.
Looks like Europe got there first. I feel like Deming, ignored in the USA but with a huge following in Japan.
Posted by: Engineer-Poet | 18 January 2010 at 02:18 PM
I suggested some time back that the luxury segment should be forced to adopt the best high-efficiency technologies first, as that's where the money is.
Looks like Europe got there first. I feel like Deming, ignored in the USA but with a huge following in Japan.
Posted by: Engineer-Poet | 18 January 2010 at 02:18 PM
Okay, that's just weird.
Posted by: Engineer-Poet | 18 January 2010 at 02:19 PM
Deming taking exception.
Of course we all know CO2 is a meaningless measure unless we are interested in depletion of plant fertilization effects.
Posted by: sulleny | 18 January 2010 at 02:37 PM
The very uber-modern systems on high-end Mercedes and BMW as well as the Tesla will give EVs some needed cachet, but that's not where the money is (the volume is too low), nor is force the way.
Posted by: ToppaTom | 18 January 2010 at 05:49 PM
Ireland has very stringent CO2 taxation on new cars for the last 2 years, and people have mainly reacted by buying diesels.
56% of new cars are now diesel.
I do not consider this a good outcome as diesels produce a great deal more LOCAL pollution (NOX, HC etc) than gasoline cars.
The CO2 is down, but all other pollution is up, exactly what the CO2 legislation was designed to do.
They should have used a compound pollution figure to include HC, particulates and NOX as well as Co2.
But that would be a bit hard for people to get their heads around.
Posted by: mahonj | 19 January 2010 at 04:38 AM
North America does not need to be as concerned with CO2 emissions, since it is already a null producer of CO2
I can't believe how preposterous some claims can be that Stan makes here. Pure fantasy!
Posted by: Will S | 20 January 2010 at 08:22 AM
mahonj:
Yes, all pollution types from ICE vehicles should be considered using (multiplied by) an appropriate harmfulness factor.
An international body would have to determine what the appropriate factors should be.
The same could be applied to coal fired power plants, wood burning fire places, wood stoves, cement factories, refineries, tar sands extraction, etc.
Automated sensors could be installed to capture pollutants level and report same to a surveillance computer for appropriate follow up and action.
Posted by: HarveyD | 23 January 2010 at 08:45 AM