Luxury carmakers set to suffer most from proposed carbon fines

German luxury carmakers and Japan’s Mazda and Subaru will be hardest hit by proposals from the European Commission to cut carbon dioxide (CO2) emissions from cars by a fifth by 2012, according to Commission figures.

On Wednesday (19 December), the Commission approved proposals to cut average emissions to 130 gram per kilometre (g/km) by 2012 after an intense internal battle. Carmakers which fail to meet the targets will face fines for every gram their average across their model range exceeds the target from 2012, starting at €20 and rising to €95 in 2015. The proposals will increase the average cost of new cars by €1,300, Environment Commissioner Stavros Dimas said.

The final agreement was attacked on all sides by industry and environmental groups.

German Environment Minister Sigmar Gabriel said: "French and Italian carmakers are the only ones that benefit." But French carmaker PSA Peugeot Citroën called the proposals "anti-ecological, anti-social, anti-economical and anti-competitive in relation to non-European Union carmakers".

Industry Commissioner Günter Verheugen sought to soften the impact of the measures on German carmakers while other commissioners argued for easing the burden on French and Italian carmakers.

The Commission proposal sets a sloping scale making allowances for greater emissions from heavier cars. The line is set in such a way that the fleet average for new cars should be 130 grams/kg. There was a fierce lobbying battle over the slope of the scale. A steep slope, demanded by the German car industry, would give heavier cars more leeway, while the French car industry wanted a shallow slope, which would favour makers of lighter vehicles. The Commission opted for a gradient which was closer to German demands.

Jos Dings of environmental campaign group Transport and Environment said: "If today’s proposal becomes law, it will boost the SUV arms race in Europe, rewarding carmakers for their climate-killing strategy of making ever heavier cars."

Commission officials said that the decision to phase in the penalties was also a concession to German carmakers. The German environment ministry had argued that the fine should not exceed €30/g.

But Dimas said that he did not expect companies to pay fines as he anticipated carmakers would improve their emissions performance by the deadline.

Under figures produced by the Commission, German sports-car maker Porsche would have to make the biggest effort to reduce the average emissions profile of its range. Porsche’s range had an average CO2 emission profile of 282 g/km in 2006. The next worst offenders are Japan’s Subaru (216 g/km), DaimlerChrysler (184 g/km), BMW (182 g/km) and Mazda (173 g/km).

Small carmakers producing fewer than 10,000 vehicles a year can apply for an individual target rather than having to comply with the 130 g/km objective.

Special purpose vehicles, such as those with wheelchair access, will be excluded from the proposal. This would mean that London taxis, which can accommodate wheelchair users, would be exempt.

The proposals will have to be approved by member states, by qualified majority voting, and by the European Parliament. The measures will run into fierce opposition from German MEPs.

German luxury carmakers and Japan’s Mazda and Subaru will be hardest hit by proposals from the European Commission to cut carbon dioxide (CO2) emissions from cars by a fifth by 2012, according to Commission figures.