Automotive industry: EU penalties another potential challenge
Deutsche Bank Research
17 December 2024
11:00 AM
The European Union (EU) is set to impose new penalties on car manufacturers that fail to meet its emissions targets. The penalties could amount to billions of euros and could have a significant impact on the automotive industry.
The EU has been gradually tightening its emissions standards for cars and vans in an effort to reduce air pollution and climate change. The current targets require car manufacturers to reduce the average CO2 emissions of their new vehicles to 95 grams per kilometer by 2021.
However, many car manufacturers are struggling to meet these targets. In 2022, the average CO2 emissions of new cars sold in the EU was 122 grams per kilometer. This means that car manufacturers are facing potential fines of billions of euros.
The EU penalties will be based on the number of vehicles that each manufacturer sells that exceed the emissions targets. The penalties will be calculated on a sliding scale, with higher penalties for manufacturers that sell more vehicles that exceed the targets.
The EU penalties could have a significant impact on the automotive industry. Car manufacturers could be forced to raise prices or reduce production in order to meet the targets. This could lead to job losses and higher costs for consumers.
The EU penalties are just one of a number of challenges facing the automotive industry. The industry is also facing challenges from the rise of electric vehicles, the global economic slowdown, and trade tensions between the US and China.
The EU penalties are a reminder that the automotive industry is facing a number of challenges. Car manufacturers need to adapt to the new emissions regulations in order to avoid penalties. They also need to invest in new technologies, such as electric vehicles, in order to remain competitive.
Automotive industry: EU penalties another potential challenge
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