Sustainability and competitiveness for the Clean Vehicles Strategy

The main aim of EU’s proposed Clean Vehicles Strategy is to enhance the sustainability and global competitiveness of the European automotive industry, while increasing the number of sustainable mobility options for European citizens and meeting their growing demand for more environmentally friendly cars.

Given that the motor car was invented in Europe, it is befitting that the EU remains the world’s largest vehicle producer. Home to 15 car-makers with international presence, the European automotive sector employs more than 12 million Europeans either directly or indirectly.

The automotive sector contributes around €140 billion of value-added to the EU economy and is a major European export earner, resulting in nearly €70 billion in trade balance annually. In addition, it represents Europe’s largest private investor in research and development (R&D).

In 2007, the EU produced around 20 million vehicles a year, representing nearly a quarter of global output, according to the European Automobile Manufacturers’ Association (ACEA).

However, the sector is currently in crisis. In 2009, total vehicle production in Europe decreased by 17.3% compared to 2008 and by 23% compared to the pre-crisis level of 2007, reaching a total of 15.2 million.

Amid this somewhat discouraging picture, one segment of the automotive market showed healthy growth: low-emission vehicles. Demand for cars emitting less than 120g of CO2 per kilometre recorded its strongest increase ever, rising by 1.2 million to reach 3.2 million units in 2009. This segment now holds a market share of 25%.

This reflects the increasing preference among European consumers for more environmentally friendly and energy-efficient vehicles, both for ecological and economic reasons. And this is an encouraging development given that, the convenience of increased mobility notwithstanding, the cars Europeans drive generate 12% of the EU’s overall carbon footprint and, while the Union managed to reduce overall greenhouse gas emissions by almost 5% between 1990 and 2004, CO2 emissions from road transport rose by 26%.

A similar process is taking place across the world. With the global car fleet set to double over the next decade, to reach 1.6 billion vehicles in 2030, many of these new vehicles will need to use alternative energy sources – such as electricity, hydrogen and biofuels – and, if not, will need to be more energy efficient.

Defragmenting European efforts

Europe stands at a crossroads: it has the opportunity to capitalise on its technological advantage to position itself at the lead of growing global demand for clean and energy-efficient vehicles, but faces the challenge of developing a constant stream of new and innovative green technologies.

Many of the economic, environmental and technologic al challenges and opportunities facing Europe in the clean car sector are common ones, and hence call for a coordinated EU response. However, there are certain areas where efforts are still fragmented, such as the national focus of much of Europe’s R&D and the absence of common European standards for electric vehicles.

In addition, the Union’s single market is home to around half a billion consumers, millions of whom are very environmentally minded. This means European industry has fertile home ground on which to grow.

In recent years, the EU has pursued numerous initiatives to promote green motoring. Since 1995, it has encouraged auto-manufacturers to develop more fuel-efficient vehicles, such as hybrid cars. Another policy priority has been improving public transport – as well as promoting cycling and walking – in order to encourage citizens to leave their cars at home.

In March 2007, EU leaders signed up to the ambitious ‘Energy for a changing world’ package which commits Member States to cut their greenhouse gas emissions by 20% by 2020. It also sets a binding overall goal of increasing to 20% the share of renewables in the EU’s energy mix.

A clean start

In a drive to boost both the environmental performance and global competitiveness of the European automotive sector in these difficult times, the European Commission has released a proposed European strategy for clean and energy efficient vehicles, which deals with all categories of vehicles, from buses and lorries to cars, vans and motorcycles. The strategy not only paves the way to helping European car-makers exit the current crisis, but it also fits in with the EU’s new ‘Europe 2020’ strategy which seeks to promote growth that is smart, green and inclusive.

The strategy seeks, among other things, to address the EU’s fossil fuel dependency; to accelerate the development of clean automotive technologies without compromising on safety; and to promote the mass-market uptake of these technologies so as to broaden the choice for consumers and boost the competitiveness of European industry in the emerging green technologies sector.

It will achieve this through the development of a comprehensive regulatory framework for clean and more energy-efficient vehicles, by supporting research and innovation into green technologies, raising consumer awareness and promoting demand, taking action at the global level to create more open global automotive markets. It will also deal with the employment challenges posed by restructuring the auto industry and re-skilling its workforce.

The Communication is now endorsed by a European Parliament Resolution and Council conclusions. The first actions envisioned in the strategy should already be launched later this year.

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