EU and Car Makers At Odds Over CO2 Emissions

The European Commission and German car makers are at odds about a proposed carbon dioxide emissions target. The Commission wants carmakers to cut their vehicles' CO2 emission to an average of 120 grams per kilometer by 2012. Carmakers say they support the idea, but site already having trouble achieving the voluntary target of 140 g/km. According to the carmaker's analysis, imposing the 120 g/km target is likely to make European industry unviable "[resulting] directly in the outflow of numerous jobs at car producers as well as in the suppler industry."

In a letter that was sent to the Commission earlier this week, chief executives for Volkswagen, DaimlerChrysler and BMW described the EU's proposed carbon dioxide emissions target as "a massive industrial policy intervention that will burden the entire European automobile industry, [and] the German [industry] in particular." Heads of the European units of General Motors and Ford also signed the letter.

A Commission spokesperson, Johannes Laitenberger, rejected the carmaker claims saying that the best way to preserve jobs was to embrace and anticipate change rather than resist it. "We have made clear there is a need for legislation to meet the target set by the Commission and the car industry of 120 g/km by 2010," Laitenberger told Reuters.

Should European carmakers need proof that this is actually the case a quick look at the dismal financial performance of the US automakers should set them on track. Whether or not European carmakers will buckle down and get with the program remains to be seen. :: Financial Times