Passenger car CO2 emissions back on track in Europe

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rovisional data release by the European Energy Agency (EEA) has shown that passenger car CO2 emissions declined for the first time since 2016. Fleet passenger car emissions fell to 107.8g CO2/km in 2020, a 11.9% fall on 2018’s 122.3g CO2/km and the largest fall since records began.

Despite best efforts of regulators, the markets shift to heavy crossovers and SUVs, coupled with de-dieselization taking hold in Europe as a consequence of the VW emissions scandal, had threatened to derail Europe’s previous serene progress in reducing fleet CO2 emissions.

In the case of 2020’s extremely positive result, the pandemic played a major role in the decline. One of the notable effects of COVID-19 on the European vehicle market has been the surge in electric vehicle sales. In Q1 2020, before the pandemic hit, battery electric vehicles (BEVs) accounted for 3.57% of the West European passenger car market. By Q4, BEV market share had surged to 10.71% (23% alone in December 2020).

This was due to a number of factors. Firstly, OEMs – conscious of the need to meet CO2 fleet targets for 2020 – flooded the market with new BEVs and increased customer choice significantly. Second, to kickstart several markets suffering under the pandemic, they introduced a number of incentive schemes to try and boost vehicle sales. Most of these schemes had a green hue, thus making BEVs a more attractive proposition for consumers.

Consequently, average fleet CO2 per km emissions plummeted and it is expected that none of the manufacturer pools for CO2 emissions will face substantial fines for non-compliance on targets in 2020.

However, 2021 promises to be tougher for the manufacturer pools to avoid compliance fines, due to tapering of incentives and changes to the European Commission’s credit system.