#Dieselgate is showing that the car industry can no longer downplay its role in decarbonising our economy. Whilst VW ignored the facts on the ground, its competitors invested. December’s Paris Agreement was just one reason why 2015 changed the automotive industry forever, here are another three:
1. The end of the fossil fuel age
The Committee on Climate Change guidance on the 5th Carbon Budget in July recommended a 44% reduction in transport emissions compared to 1990 levels by 2030. Currently 95 percent of all road transport is powered as it was a hundred years ago, using up 64 percent of all oil production. The Committee expects over 60% of new car and van sales to be fully electric or plug-in hybrid by 2030, transforming the UK market and manufacturing. Road transport accounts for only 19% of UK emissions covered by the Carbon Budgets but a transformative emissions reduction, reducing this to close to zero is essential to meet the UK’s 2050 target.
The Paris Climate Change Agreement brings the age of fossil fuel transport to its final chapter. Transformation emissions reductions in transport are essential given the number of vehicles on the world’s roads is set to at least double from about 800 million today to more than 2 billion by 2050.
The Intended Nationally Determined Contributions submitted by 198 countries at COP21 demonstrates new global cooperation on climate change with all countries agreeing to progressively and transparently ramp up ambition to decarbonise. This provides clarity on direction of travel in the global energy transition and increases confidence that commitments will be met.
2. An internal crisis in the industry
Polluted air in London, Paris and Beijing hit the headlines. In April, the UK Supreme Court ordered the Government to reduce air pollution in England’s most polluted cities, whilst the Chinese Government announced new restrictions on vehicles in northern cities as pollution in Beijing soared to ten times the safe limit.
The VW emissions scandal showed that official vehicle emissions data are not just off track, they are often a lie. #Dieselgate is expected to cost the company around $80bn.
New European emissions tests get closer to the ‘real world’. With EU emissions testing last amended in the 1990s the new test procedure will reduce the current emissions gap by removing most of the opportunities for gaming the tests used by VW and others.
3. Innovation moves from research to delivery
Electric cars are expected to be cheaper than conventional vehicles by 2030. Analysis by the Committee on Climate Change argues that by 2030 the total lifetime cost of an electric car will be almost £4,000k lower than for a conventional petrol or diesel powered car.
After the Paris Agreement, 13 automotive industry Chief Executives sign a joint declaration to decarbonise their fleets, including Nissan-Renault, Chrysler-Fiat, Ford Group and General Motors. A statement issued by the Nissan-Renault Chief Executive Carol Ghosn shows that ‘Big Auto’ has smelt the coffee:
"transition will occur one way or another. It will either be an orderly transition over the next two to three decades, or a disorderly one, spurred by crises and human hardship’ and, you could add, declining profits"
Electric fleet announcements by the world’s largest manufacturers. In October, Volvo confirmed plans to make every car in their fleet available as a fully electric vehicle by 2019 following announcements from Nissan-Renault, Toyota and many others. Meanwhile Aston Martin announced a 1000bhp electric car, Tesla announced that it had sold over 50,000 of its fully electric ‘family car’, and Chevrolet launched the first truly affordable electric car with a 200mile range.