Hours before the Frankfurt Motor Show flung open its doors to the press on Tuesday, the chief executive of Volkswagen was locked in debate with Tina Velo, a well-known environmental activist.
“Demonising the car is not going to help,” Herbert Diess said during the robust hour-long exchange. “The electric vehicle is by far the best way to make individual mobility [travelling by car] CO2 free.”
Inside the show the urgent need to scale back emissions permeated the 11 halls of the gigantic Messe exhibition centre.
The new electric cars on display, from the Porsche Taycan to the Opel Corsa-e, drew crowds — but they will also need to attract a significant number of buyers if manufacturers are to avoid punitive fines.
Under EU rules, carmakers must lower average CO2 emissions from the vehicles across their fleet to 95g per km, or face penalties that could run into hundreds of millions, even billions, of euros.
Many are placing significant bets on fully-electric cars to get them across the line.
VW dominated the show, not just because the world’s largest carmaker occupied the entirety of one of the site’s cavernous aircraft hangars, but also because of its battery-driven ID3, the first car based on its new electric platform. VW forecasts that 50 different models will use the platform, called MEB, across its 12 brands by 2025.
Mr Diess said he expects about 100,000 of the ID3 models to be sold next year, alongside 60,000 equivalent vehicles from its stable of brands ranging from Skoda to Porsche.
Despite the looming CO2 deadline, now only months away, a quiet confidence flowed through the halls of the show, with executives unified in claiming they will meet the goals, no matter how onerous that appears.
The confidence of Mr Diess and other bosses is also in the face of planned protests by environmentalists such as Ms Velo, whose campaigners are threatening to disrupt the flagship event of the German carmakers at the show this weekend.
Even PSA, which is regarded as one of the laggards of the industry, said it will meet the targets.
“Our basic stance is to be compliant,” said chief executive Carlos Tavares, adding that a wave of new electric vehicles being launched in the second half of this year, as well as a third early in 2020, with plug-in hybrid vehicles across several of its models.
All it needs now is customers to purchase those cars.
On the eve of the show, green energy campaign group Transport & Environment said it expects 1m electric or plug-in hybrid cars to be sold across Europe, a fourfold increase on 2018’s levels.
Yet typically car buyers have baulked at the high price of electric vehicles, or their limited driving range before requiring a charge.
During the show ACEA, the body that represents European carmakers, called for a “major ramp-up of charging and refuelling infrastructure, as well as meaningful purchase incentives to stimulate sales, helping to achieve the goals set by the EU”.
Max Warburton, an analyst at Bernstein who was at the show, said: “While the carmakers made a big song and dance about their electric vehicle plans in public, in conversations behind the scenes the discussion was more sober.
“No one really has any confidence in market demand, pricing, or the ability to make margins.”
This is why several carmakers are pegging their hopes in part on advances in traditional combustion engine technology.
PSA’s Opel brand, which includes the UK Vauxhall nameplate, expects a huge drop in CO2 as the Astra, which accounts for a fifth of its sales, moves from a four-cylinder engine to a three-cylinder one, dropping the car’s carbon output by more than a fifth, chief executive Michael Lohscheller told the FT.
The brand also launched the Corsa-e, an electric version of the model, one of the cars parent group PSA is counting on to contribute to its efforts to hit CO2 targets.
Others are embracing hybrid technology, which runs a battery and combustion engine in parallel.
Toyota, which skipped the show, already has about two-thirds of its cars in Europe running on hybrid technology. As a result, the group is considered in least danger of missing its CO2 targets.
At the other end of the spectrum is Ford, which is late to both hybrid and electric systems, but plans an aggressive rollout of a mild hybrid system called 48v, which uses a small battery to aid the engine, allowing modest engines to power large cars.
Ford expects customers to flock to this technology, in large part because of fuel economy savings.
The company’s European president Stuart Rowley said: “It’s about a 10 per cent fuel economy improvement. That’s a very accessible way for a lot of our customers to get an electrified vehicle.”
It believes half of all its vehicle sales will be battery-aided in some way by 2022, a very ambitious timeline given its current position at the back of the pack.
Despite the decline in diesel’s popularity, falling from half of European car sales in 2015 to about a third currently, the scandal-tainted fuel source is still an important pillar for some manufacturers because it emits a fifth less CO2 than petrol.
Half of BMWs sold in Europe still run on the fuel, head of sales Pieter Nota said, while the uptake of the brand’s plug-in hybrids and continued growth of its electric vehicles such as the i3, will also help ease its CO2 count lower.
“It’s a tough target, but we are committed to get there,” he added.
The situation is mirrored at Mercedes-Benz.
“If we look at the diesel engines we have now . . . We still have a significant benefit on the fuel economy side,” said Ola Källenius, chief executive of parent company Daimler.
Yet despite the public optimism, there remains nervousness as carmakers see January approaching.
“Everybody is worried about the next two to three years,” said Luca de Meo, chief executive of VW’s Seat brand. “We have the conditions for a perfect storm: lower demand, increasing R&D budgets, and [the potential of] fines.
“Everyone will be crossing the desert.”
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