FT.com: It was a move worthy of an environmental campaigner, not a state shareholder.
The French government, which owns about 15 per cent of carmakers Renault and PSA Peugeot Citroën, has pledged to “progressively” ban from 2015 diesel vehicles — which account for two-thirds of car sales in the country and almost two-thirds of Renault and Peugeot’s European sales.
The November announcement by prime minister Manuel Valls — in which he admitted the promotion of diesel cars had been a “mistake” — was followed last month by a promise from Paris mayor Anne Hidalgo to ban these vehicles from the city by 2020.
France’s stance highlights a big shift taking place in the European debate over vehicle pollution. For a decade or more, policy makers have focused on targets to reduce carbon dioxide emissions, and this prompted carmakers to invest heavily in diesel vehicles because they emit less CO2 than the petrol equivalents.
But now the focus is turning to air quality, which raises far-reaching questions about the viability of diesel vehicles. This is because they emit harmful pollutants such as nitrogen oxide that can cause serious respiratory problems.
“Having long been seen as a ‘clean fuel’, diesel is now seeing something of a backlash in Europe,” says Stuart Pearson, analyst at Exane BNP Paribas.
Cities are under pressure from the European Commission to tackle pollution. Studies from the International Council on Clean Transportation, a research body, and King’s College, part of the University of London, have highlighted the scale of emissions from diesel vehicles and linked them to as many as 60,000 deaths a year in the UK.
London has vowed to act on these findings. Under plans for an “ultra low emission zone” in the city, the capital’s traffic congestion charge would be almost doubled for older diesel vehicles by the end of the decade, and Islington council is set to introduce a parking fee for the most-polluting cars — “to encourage a move away from diesel vehicles”.
Cities in Norway have discussed similar anti-diesel measures.
The changing stance of European policy makers presents a big problem for the continent’s biggest carmakers, including the two French state-backed companies and the big three German manufacturers.
Most exposed, according to research by Exane, are BMW and Daimler, whose “diesel mix” — those vehicles as a proportion of total sales — is 81 per cent and 71 per cent respectively in Europe. Volvo is even higher, at 90 per cent.
These sales reflect how governments have long been pursuing policies that pushed manufacturers and drivers towards diesel vehicles.
In the UK, for instance, company cars — 50 per cent of sales nationwide — are taxed on the basis of their CO2 rating, making it beneficial to buy diesel vehicles. As recently as November, diesel vehicles added almost twice as many monthly sales as electric and hybrid equivalents in Britain.
Consumers like the high fuel efficiency and driveability of diesel cars, with the extra torque particularly useful in cities. Furthermore, diesel is cheaper than unleaded petrol in many European countries.
Diesel vehicles have become more environment-friendly, according to the UK’s Society of Motor Manufacturers and Traders. It says modern diesel vehicles now capture about two-thirds of nitrogen oxide emissions through certain filters.
Carmakers will be wary of any moves to phase out diesel vehicles, which would already add to the considerable burden of meeting CO2 targets set for the end of the decade and demand swifter take-up in the still uncertain market for hybrid and electric vehicles.
“This is a European industry concern,” says Ian Robertson, BMW’s board member for sales and marketing.
“Our position is, don’t rush into any targets on [diesel] . . . until there’s been an industry and societal view on what’s possible. Ninety per cent of the cars in Paris are diesel — that’s a massive shift.”
There is growing concern that the emphasis on diesel has encouraged European manufacturers to bet on a technology that is only really bought in their home continent.
While Europe leads the world as the biggest market for diesel cars, there has been very little take-up in Japan and the US.
“Unless the market in diesel takes off around the world — and that looks increasingly unlikely — the European manufacturers are effectively backing the wrong technology,” says Greg Archer, clean vehicles manager at Transport & Environment, a Brussels-based think-tank.
He also argues that the perceived CO2 benefits of diesel have been overstated if the overall “well to wheel” impact of using the fuel is taken into account. The fuel is more energy intensive to refine, and the types of diesel cars consumers purchase tend to be heavier than the petrol equivalents.
“When you take all of these life-cycle factors into account, what you actually find is diesels are not lower CO2 than gasoline, they’re just more fuel-efficient at the tailpipe,” says Mr Archer.
The French government, which owns about 15 per cent of carmakers Renault and PSA Peugeot Citroën, has pledged to “progressively” ban from 2015 diesel vehicles — which account for two-thirds of car sales in the country and almost two-thirds of Renault and Peugeot’s European sales.
The November announcement by prime minister Manuel Valls — in which he admitted the promotion of diesel cars had been a “mistake” — was followed last month by a promise from Paris mayor Anne Hidalgo to ban these vehicles from the city by 2020.
France’s stance highlights a big shift taking place in the European debate over vehicle pollution. For a decade or more, policy makers have focused on targets to reduce carbon dioxide emissions, and this prompted carmakers to invest heavily in diesel vehicles because they emit less CO2 than the petrol equivalents.
But now the focus is turning to air quality, which raises far-reaching questions about the viability of diesel vehicles. This is because they emit harmful pollutants such as nitrogen oxide that can cause serious respiratory problems.
“Having long been seen as a ‘clean fuel’, diesel is now seeing something of a backlash in Europe,” says Stuart Pearson, analyst at Exane BNP Paribas.
Cities are under pressure from the European Commission to tackle pollution. Studies from the International Council on Clean Transportation, a research body, and King’s College, part of the University of London, have highlighted the scale of emissions from diesel vehicles and linked them to as many as 60,000 deaths a year in the UK.
London has vowed to act on these findings. Under plans for an “ultra low emission zone” in the city, the capital’s traffic congestion charge would be almost doubled for older diesel vehicles by the end of the decade, and Islington council is set to introduce a parking fee for the most-polluting cars — “to encourage a move away from diesel vehicles”.
Cities in Norway have discussed similar anti-diesel measures.
The changing stance of European policy makers presents a big problem for the continent’s biggest carmakers, including the two French state-backed companies and the big three German manufacturers.
Most exposed, according to research by Exane, are BMW and Daimler, whose “diesel mix” — those vehicles as a proportion of total sales — is 81 per cent and 71 per cent respectively in Europe. Volvo is even higher, at 90 per cent.
These sales reflect how governments have long been pursuing policies that pushed manufacturers and drivers towards diesel vehicles.
In the UK, for instance, company cars — 50 per cent of sales nationwide — are taxed on the basis of their CO2 rating, making it beneficial to buy diesel vehicles. As recently as November, diesel vehicles added almost twice as many monthly sales as electric and hybrid equivalents in Britain.
Consumers like the high fuel efficiency and driveability of diesel cars, with the extra torque particularly useful in cities. Furthermore, diesel is cheaper than unleaded petrol in many European countries.
Diesel vehicles have become more environment-friendly, according to the UK’s Society of Motor Manufacturers and Traders. It says modern diesel vehicles now capture about two-thirds of nitrogen oxide emissions through certain filters.
Carmakers will be wary of any moves to phase out diesel vehicles, which would already add to the considerable burden of meeting CO2 targets set for the end of the decade and demand swifter take-up in the still uncertain market for hybrid and electric vehicles.
“This is a European industry concern,” says Ian Robertson, BMW’s board member for sales and marketing.
“Our position is, don’t rush into any targets on [diesel] . . . until there’s been an industry and societal view on what’s possible. Ninety per cent of the cars in Paris are diesel — that’s a massive shift.”
There is growing concern that the emphasis on diesel has encouraged European manufacturers to bet on a technology that is only really bought in their home continent.
While Europe leads the world as the biggest market for diesel cars, there has been very little take-up in Japan and the US.
“Unless the market in diesel takes off around the world — and that looks increasingly unlikely — the European manufacturers are effectively backing the wrong technology,” says Greg Archer, clean vehicles manager at Transport & Environment, a Brussels-based think-tank.
He also argues that the perceived CO2 benefits of diesel have been overstated if the overall “well to wheel” impact of using the fuel is taken into account. The fuel is more energy intensive to refine, and the types of diesel cars consumers purchase tend to be heavier than the petrol equivalents.
“When you take all of these life-cycle factors into account, what you actually find is diesels are not lower CO2 than gasoline, they’re just more fuel-efficient at the tailpipe,” says Mr Archer.
