Sustainability 2011/12

Climate Change and the Environment

European Policy

The European Union has set mandatory carbon dioxide (CO2) targets for both cars and light commercial vehicles. The specific target for an automaker depends on the average weight of the automaker’s vehicles registered in a given year. Due to the relatively low average weight of Ford cars registered in the EU this results in stricter targets for Ford compared to the overall industry target of 130 g/km during the 2012–2015 period and 95 g/km in 2020.

The EU has also established significant regulations about other items related to climate change, such as fuels (including bio-blending), tires and gear-shift indicators, among others. In fact, automobiles are one of the most regulated products in the EU, with requirements also covering non-CO2 emissions, drive-by noise, recycling, substances, electro-magnetic requirements, safety, technical aspects and more. Ford is complying and will continue to comply with all these various targets and prohibitions with appropriate product offerings, in spite of the sudden dramatic economic downturn that severely limited the resources available to respond.

In general, Ford is requesting that regulations and policies be well coordinated and not contradictory to each other and that they be technology-neutral, be proportional, avoid double regulation, offer sufficient lead time to adjust development and production cycles and follow an integrated approach in which all stakeholders (industry, infrastructure, consumers and governments) contribute to the solution. Any CO2 regulations should also be in line with meeting the global CO2 target of 450 ppm.

In some EU member states, CO2 taxation is in place to encourage the early introduction of low-CO2 vehicles. The major tax break points are often around 95/100 g/km, 120 g/km and 160 g/km. Unfortunately, these tax break points are not harmonized among the European countries.

The industry will continue to invest heavily in research and development and new product programs in order to reach short-term CO2 targets. The long-term target will require technological breakthroughs, new refueling infrastructure and a swift renewal of the car fleet on Europe’s roads.