Car Manufacturers in row over EU emissions controls

10 March 2008

In December, the executive European Commission proposed steep penalties for car makers whose fleet exceeds an average of 120 grams per km of CO2 - the main greenhouse gas blamed for climate change.


The EU executive favours fines based on a system of CO2 emission per km, but using the weight of a vehicle for 60 percent of the calculation for penalties - an approach that angered German and French car makers for differing reasons.

Germany, home to luxury models such as Porsche argues that this would favour lighter vehicles.


"We must revisit the levels of the fines. All categories must bear the burden," Matthias Machnig, German secretary of state for the environment, said during a public debate.


However, the makers of popular small French cars such as Renault and PSA Peugeot Citroen dismiss this claim and say the system hits their sector of the industry even harder.


"60 will be very difficult," French environment minister Jena-Louis Borloo said, adding that he favours a figure less than 30.


"It is hard to accept that heavier and more powerful cars with greater emmissions do not have to pay more."


Fines on companies for non-compliance will start at 20 euros ($30.34) per new car for each excess gram per km in 2012 on average over the whole fleet, and rise to 95 euros g/km in 2015.


Germany was supported during the debate by the Czech Republic, Hungary, Austria and Slovakia -- all countries with German car manufacturing hubs - and Sweden which has Saab and Volvo among its car makers.


Italy, where Fiat is based, and Romania both backed the French bid to have the percentage reduced, while Britain also sought an exemption for what it described as "niche market" operators such as British-made Jaguar, Rolls Royce and Bentley.


Britain proposed that all carmakers should improve on their current emissions reductions plans by at least 25 percent.


"We want a demand for a simpler 25 percent effort by everybody. The current proposal does not pass the competitive neutral test," British environment secretary Hilary Benn said.


Under the Commission's proposals, car makers producing less than 10,000 vehicles will not be required to meet the targets set.

The proposals will require the qualified majority of the 27 ministers and the European Parliament before coming into force.



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