The European Union is preparing to take another significant step in its fight against climate change. Starting next year, stricter emission limits for car manufacturers will come into effect. This move is set to have a profound impact on the automotive industry and could significantly influence the supply and pricing of electric vehicles in the market.
New Emission Limits: A Challenge for Manufacturers
From January 1, 2025, car manufacturers will need to reduce the average CO2 emissions of their vehicles to below 93.6 grams per kilometer. This represents a substantial tightening of current limits. Mattias Bergman, CEO of Mobility Sweden, states: "Manufacturers must bring vehicles with lower emissions to the market. If they exceed the set limit, they risk hefty fines."
Uneven Development Across Europe
While some countries, such as Sweden, have already achieved a 32% market share for electric vehicles, others are lagging significantly behind. In Poland and Romania, electric vehicles comprise only a few percent of sales. This uneven development is putting pressure on manufacturers to compensate for low sales in some countries with higher sales elsewhere.
Strategies of Car Manufacturers
Car manufacturers now need to consider various strategies to meet the required limits. One option is to increase sales of electric vehicles and plug-in hybrids. Another approach is to reduce emissions in petrol and diesel engines. Bergman adds, "If electric vehicles aren't selling in one country, it must be compensated for in another market."
Plug-in Hybrids Under Scrutiny
An interesting development has occurred with plug-in hybrids. Initially expected to have low CO2 emissions, it has been revealed that European owners of these vehicles use the combustion engine more frequently than anticipated. This has led to an adjustment in the emission measurement methodology for these vehicles.
Who Are the Leaders in Meeting New Standards?
Currently, only two manufacturers meet the new emission limits - Geely (thanks to high sales of Volvo electric vehicles) and Tesla. Other manufacturers must act quickly to avoid high fines. Some are considering purchasing emission credits from more successful competitors.
Expected Market Developments
Some experts predict a significant drop in electric vehicle prices due to pressure to increase sales. However, Bergman cautions, "You can't just produce cars; there must also be buyers. Most private individuals are primarily guided by finances." Nevertheless, he expects 2025 to be favorable for the automotive market, thanks to a combination of pent-up demand and expected interest rate reductions.
The EU's new emission limits present a significant challenge for the automotive industry. Their impact on the electric vehicle market and overall vehicle supply will be closely monitored by experts and consumers in the coming months.
