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By APD writer Aditya Nugraha
FRANKFURT, Sept. 10 (APD) - European carmakers are facing challenging problems over race on electric car productions and European Union emission targets that carries fines up to billions of Euros should they fail to comply with it.
In the Frankfurt auto show opened since Tuesday, European automakers launched their new models of electric cars in their hope of capable to cut down carbon dioxide emissions in months to come.
The EU has required new cars in Europe must comply with lower emission regulation by 2021. For the initial phase the CO2 must be cut to 95 grams per kilometer for 95 percent of cars by next year from the current 120.5 grams average.
Another 37.5 percent cut in carbon dioxide fumes is required between 2021 and 2030 in addition to the 40 percent cut in emissions between 2007 and 2021.
Pricey cost to develop high technology for electric cars could batter the profits of European carmakers amid their sales downturns at present. Adding to problem in the sales of the costly electric cars, unconvinced consumers give the automakers another problem.
In political situation, the chaotic Brexit and trade tension between China and the United States would also risk the European automakers to develop and sell electric cars.
Automakers, however, realized that producing the electric vehicles is avoidable in the global developing green drives and apparent impact of climate change that already felt by nations across the world.
Volkswagen Chief Executive Herbert Diess said regulatory pressures and growing support for green causes prove that Volkswagen's 80 billion euro (U$ 88 billion) investments to become the world's largest manufacturer of electric cars is right.
"Even Toyota and some other competitors, which were slow to bring EV's, they are now also hoping on electric. So we are right," said Diess.
Volkswagen launched its ID.3 compact electric car and hybrid version of its best seller Golf model.
German engineering firm FEV Consulting estimated that to meet the targets, sales of electric cars would need to triple to six percent of the market by 2021, and rechargeable hybrids surge fivefold to a five-percent market share.
Rather than incur fines that could total 25 billion euros (US$ 28 billion) in 2021 if current models were left unchanged, carmakers are engaged in a huge product overhaul likely to wipe more than half that amount from combined profits.
For years carmakers have placed electrified models at the center of their show stands but near the margins of their commercial models. Now they are forced to sell them in large numbers, challenging profitability.
(ASIA PACIFIC DAILY)
