New research has found that the “majority” of car manufacturers face “significant fines” if they fail to meet EU CO2 emissions targets by 2021.
The new research by PA Consulting, predicts that Volkswagen, Ford, Fiat, PSA, BMW, Daimler, Mazda and Hyundai-Kia could all face fines as part of missing emissions targets. The research found that Volkswagen could be fined up to €1.4bn (£14.4m) as the result of its range-wide average shortfall.
PSA currently faces the largest impact from fines based on EBIT, amounting to €600m (approx £540.1), 20% of the company’s 2017 profit.
A statement included in the report read: “Ford and Volkswagen have gone backwards and in 10th and 11th place, respectively. Daimler and BMW are making progress towards their targets and Jaguar Land Rover still has the highest CO2 emissions, but is on track to meet its specific target.”
Michael Schweikl, automotive expert at PA Consulting, said: “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 key in getting manufacturers closer to the targets.
“Car makers need to look beyond 2021. The European Parliament voted to introduce rules that would force car makers to lower their 2020 CO2 emissions targets by 40% by 2030. The final agreement could be closer to a compromise of 35% reduction by 2030 if all EU stakeholders agree on this latest proposition from environment ministers group.”
He added: “As such, car makers face a huge change in what they do as they move from the old technology of combustion engines to low emission electric vehicles. While much exciting technological development is already underway, manufacturers cannot underestimate the complexity, cost and cultural change required.”