Manufacturers facing huge fines after ‘step backwards’ on emissions

Manufacturers facing huge fines after ‘step backwards’ on emissions

EUROPE’S 13 top carmakers will miss their 2021 emissions targets and will face fines of more than £12.4bn, according to the annual forecast of car manufacturers’ performance against mandatory EU CO2 targets.

After four years of steady progress, research published by PA Consulting, the global innovation and transformation consultancy, has revealed a step backwards.

Emissions have increased across the board, mainly due to customers buying SUVs; strong demand for high-powered and heavier cars; lack of low-emission options in showrooms; and shifting preference for petrol cars after the diesel scandal.

Some car makers will see penalties high enough to have a material impact on their profitability and reputation. Volkswagen could be fined as much as £3.85 billion due to its high sales volumes across Europe.

Equally, previous top performers such as Renault-Nissan-Mitsubishi, Volvo and Jaguar Land Rover look set to fall short.

Even Toyota, the market leader in hybrid vehicles, is forecast to miss its target. Jaguar Land Rover would face the biggest impact from fines.

Michael Schweikl, automotive expert at PA Consulting, says: ‘Despite this ”four steps forward, one step back” situation, the good news is that there are many options open to car makers to reduce emissions and minimise future fines. But the urgency of the situation means they have to act quickly.

‘Car makers are running out of time to improve performance quickly enough to avoid fines. Marketing, sales and pricing strategies that increase the take-up of low-emissions vehicles will be essential in getting manufacturers closer to the targets.’

From next year, phased in from 2020, the EU fleet-wide average emission target for new cars will be 95g CO2/km.

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