Auto industry sets out plan for carbon neutrality under EU Green Deal, amid shrinking market

Forecasting the first downturn in EU car sales in seven years this year, the European Automobile Manufacturers’ Association (ACEA) outlined the major challenges faced by the EU auto industry, as it embarks on the transition to carbon-neutral transport.

“One of the biggest drivers of change for our sector is the need to address environmental concerns,” said Michael Manley, ACEA president and CEO of Fiat Chrysler Automobiles (FCA). “The good news is that carbon-neutral road transport is possible and together – with a holistic approach – we can reach it by 2050. But that also means a lot needs to change in the next few decades.”

Speaking to journalists in Brussels last week, Manley launched the EU auto industry’s ‘10-point plan to help implement the European Green Deal’, in which the 16 major automobile manufacturers set out how CO2 emissions can be further reduced in the most effective way.

“Firstly, we believe in choice for all. Policy makers should help drive the best possible results by remaining technology neutral – in other words, without imposing specific technologies or banning vehicles that can still deliver CO2 reductions.”

In addition, a dense network of charging points and re-fuelling stations – suitable for cars and commercial vehicles – must urgently be rolled out across the EU to support the deployment of alternatively-powered vehicles. This is one of the single most important enabling conditions for achieving carbon neutrality, according to the industry.

New low-emission technologies are expensive and will remain so for the foreseeable future. To ensure that the higher prices do not slow down fleet renewal, ACEA is also calling for consistent and economically-sustainable incentive schemes for users of both cars and commercial vehicles.

“Above all, we believe that road transport and mobility must remain affordable for everybody, regardless of where in Europe they live or their financial means. Likewise, the European Commission’s Green Deal should also be used as a means to strengthen the global competitiveness of our industry.”

“This is all the more important as we are about to face a shrinking market,” he said. Indeed, ACEA forecasts that, after six consecutive years of growth, EU passenger car sales will drop by 2% in 2020.

“At the very time when our industry is massively stepping up investments in zero-emission vehicles, the market is set to contract – not only in the EU but also globally – so the transition to carbon neutrality needs to be very well managed by policy makers.”