How COP27, Fit for 55 and Euro 7 could change the automotive industry
23 November 2022
In the last few months of 2022, the automotive industry has seen a trio of significant sustainability step changes. COP27, Fit for 55 and Euro 7 each contain the potential to transform the future of vehicles. Autovista24 deputy editor Tom Geggus and journalist Rebeka Shaid consider whether these changes will be successful.
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Show notes
A sustainable automotive industry? Cars, climate change and COP26
COP27 reaches breakthrough agreement on new ‘loss and damage’ fund for vulnerable countries
Car CO2 targets: No time to waste for putting conditions for zero-emissions in place, says industry
Infographic – Fit for 55: Why the EU is toughening CO2 emission standards for cars and vans
Brussels Playbook: Breton wants to save Das Auto
Stellantis CEO: Europe auto emissions standards a ‘diversion’
Synopsis
One of the major announcements at COP27 came on 17 November with the formation of the Accelerating to Zero (A2Z) coalition. With over 200 organisations pledging their support, A2Z will follow up on the Zero-Emission Vehicles (ZEV) declaration established at COP26. The overall aim is to secure more ambitious commitments as the automotive industry shifts to ZEVs.
‘The ZEV declaration signed at COP26 was a major milestone, bringing together leading actors to accelerate the transition to 100% new-car sales being zero-emission by 2040, and 2035 in leading markets,’ said Alok Sharma, COP26 president.
‘There are still huge opportunities in emerging markets and developing economies, which is why I am pleased to formally launch the Accelerating to Zero coalition today. This coalition provides the platform for countries to go further and faster and to ensure that no country is left behind,’ Sharma added.
Fit for 55
Shortly before COP27, the EU signalled that it is serious about adopting laws to reach vital climate targets. As part of the bloc’s green deal – known as ‘Fit for 55’ – the EU wants to shift to electromobility. A major step in this direction was reached at the end of October when the European Parliament and the Council struck an agreement on the matter.
The new regulation aims for a 55% CO2 emission reduction target for new cars and 50% for new vans by 2030, compared to 2021 levels. The legislation paves the way for a 100% CO2 emission cut by 2035, in effect banning the sale of new internal-combustion engine (ICE) cars from the middle of the next decade. The deal is set to reshape mobility and will have global implications. Other parts of the world are also planning to phase out the sale of new petrol and diesel cars, and the EU is eager to set an example as the first continent to go climate-neutral, by 2050.
For the European automotive industry, the regulation will have far-reaching repercussions. Thierry Breton, EU commissioner for the internal market, cautioned the ban on new petrol and diesel cars would cause a ‘gigantic disruption’ to European industries. Policymakers will review the phase-out date in 2026, which could in theory be pushed back – but only if necessary.
Integrating infrastructure
Meanwhile, European automotive associations want to see framework conditions reflected in the EU’s climate policies. According to them, this should include the availability of renewable energy, a well-developed private and public-charging infrastructure, and sufficient access to raw materials. Automotive-industry bodies are urging the EU to forge energy partnerships and raw-material agreements as quickly as possible.
Germany’s Association of the Automotive Industry (VDA) argued that the EU’s CO2 fleet regulation should be considered alongside the Alternative Fuels Infrastructure Regulation (AFIR), which aims to spur the deployment of charging points.
As European carmakers ramp up electrification targets and prepare new electric-vehicle (EV) launches, market competition is set to increase, especially from Asian players. While the focus will be aimed at zero-emission systems, industry bodies are calling for ‘technology openness’. This would allow for climate-neutral fuels to be used in ICE models beyond 2035. But this proposal would require a fundamental update to the newly reached agreement. It would also have to be backed by members of the European Parliament.
More stringent standards
In early November, the European Commission proposed a new set of emission standards to be carried out under the type-approval process, known as Euro 7. This looks to use more stringent testing scenarios for new vehicles, with tighter conditions for brakes and tyres, as well as exhausts. Cars will need to stay clean for longer, as durability requirements look to double from the previous standard. EV batteries will also see greater regulation, as the commission hopes its proposals will inspire greater consumer confidence.
However, Euro 7 has not received a warm welcome from the automotive industry. The European Automobile Manufacturers’ Association (ACEA) pointed out that the legislative package would likely not be ready until roughly 2024. It claimed this would make the implementation dates of July 2025 for cars and vans, and July 2027 for heavy-duty vehicles, unrealistic.
‘The automotive industry takes its role to reduce both CO2 and pollutant emissions very seriously. Indeed, last year we made a very constructive proposal for a new Euro 7, which would bring a major reduction in criteria pollutants, thus improving air quality,’ said Oliver Zipse, ACEA president and BMW CEO.
‘Unfortunately, the environmental benefit of the Commission’s proposal is very limited, whereas it heavily increases the cost of vehicles. It focuses on extreme driving conditions that have hardly any real-life relevance,’ he concluded.
