As Deputy Head of the Sustainable Mobility and Automotive Unit in the European Commission’s Directorate General for Enterprise and Industry, Barbara Bonvissuto is responsible for managing and planning sustainable mobility and automotive activities. Her work focuses on strengthening the competitiveness of the European automotive industry by implementing an effective internal market regulatory framework and international regulatory harmonisation, as well as enhancing co-ordination of policy areas affecting the sector. At present, the work of the Sustainable Mobility and Automotive Unit is focused on implementation of the CARS 2020 communication; regulatory files, including eCall for passenger cars and revision of the type-approval framework for motor vehicles; international harmonisation files, such as reform of the UNECE 1958 Agreement on international regulations in the automotive sector; and negotiation of the automotive regulatory chapters in trade agreements with the US and Japan. Speaking prior to Automotive World’s Megatrends Europe 2013, here Bonvissuto voices her thoughts on four of the biggest issues affecting the European industry today. What do you think the new free trade agreement with Canada will mean for the European automotive industry? The Comprehensive Economic and Trade Agreement (CETA) between the EU and Canada is an overall very ambitious agreement and significant in economic terms. After it has been in force for seven years, tariffs on cars on both sides will be fully dismantled, with consequent important economic gains. Canada’s current tariff on passenger cars is 6.1% and the EU tariff is 10%; the EU exported to Canada more than 100,000 passenger cars last year, with a value of almost €3bn. According to the Sustainability Impact Assessment performed by the Commission services, the removal of tariffs is estimated to lead to increases in output of automotive products ranging from 0.21% to 0.86%. This increase would stimulate trade, with overall exports expected to increase for automotive products by 0.36% to 1.11%. The agreement not only covers tariffs, but also includes disciplines on non-tariff barriers. In particular an annex on motor vehicle regulations has been agreed, that focuses on strengthening cooperation and the sharing of information between the EU and Canada. One of the more concrete outcomes of such cooperation is the listing of 17 United Nations Economic Commission for Europe (UNECE) regulations that, by the Agreement’s coming into force, Canada will have incorporated as an alternative to its domestic standards. This means that, with respect to the items covered by these UNECE regulations – ranging from electronic stability control for passenger cars to lightning – EU manufacturers will not have to redesign their cars to be able to export them to Canada, with significant cost-savings. In addition, the parties agreed on a work programme to discuss future regulatory cooperation. How does the EU reconcile national scrappage and incentive schemes with its single market vision? Scrappage and incentives can be useful instruments to foster market uptake of clean and energy-efficient vehicles. The implementation of demand measures has indeed been recognised by the members of the CARS 21 High Level Group as an essential tool in order to improve customer awareness and acceptance of cleaner vehicles. However such incentives can also create distortions in the EU internal market. This is why the European Commission published, in February 2013, guidelines on how Member States should use financial incentives to best increase demand for low CO2 emission vehicles. The guidelines provide a set of mandatory principles Member States must follow, such as: non-discrimination of vehicle origin; compatibility with EU type-approval legislation, and non-violation of EU state-aid rules. They further include a set of recommended principles, such as technological neutrality; reference to common performance criteria; proportionality of incentives; reference to EU CO2 limits. By establishing a common framework at EU level, the guidelines aim at avoiding possible fragmentation of the internal market, ensuring a level playing field for business and increasing the efficiency of the incentives at the EU level. ACEA’s Ivan Hodac recently questioned why Europe has the “toughest” CO2 requirements in the world – from your position within the EC, do you think this is right, or fair, to say? As acknowledged by the members of the CARS 21 High Level Group, the regulatory targets for light duty vehicle CO2 emissions are essential for ensuring the reductions needed to meet the EU medium and long term climate objectives. These are also expected to drive innovation. Technologies are available for meeting the 2020 targets and vehicle manufacturers and component suppliers have already invested in this area with a view of meeting them. All of our major trading partners (the United States, Japan, China, Canada, South Korea) have adopted CO2/fuel efficiency standards. The EU is not special in this. The main reason why regulatory frameworks are in place is that they are addressing a market failure. Purchasers of cars do not internalise the fuel operating costs of the car over its lifetime when making a purchase decision. It is not straightforward to compare stringency of different CO2/fuel efficiency standards in different markets because of different test procedures, different vehicle types and mixes, the coverage of the Regulations and even the fuel used. In fact, when the rate of improvement required in different world markets is compared, it can be seen that these are rather similar, but that the starting points are somewhat different. As acknowledged in the CARS 2020 communication, the 2007 EU strategy embraced a comprehensive approach to reducing CO2 emissions where actions on engine technology have been complemented by other measures, targeting alternative fuels, driver behaviour and other technological improvements. Also for future policy, defining the most appropriate measures to reduce road transport CO2 emissions in a holistic way, based on a careful assessment of costs and benefits, is crucial. EU car CO2 Regulations apply to cars registered in the EU. In view of this they apply equally to manufacturers from every country, regardless of where the cars are manufactured. So there is no distortion of competition between a manufacturer based in or manufacturing in the EU compared to one based in or manufacturing in another country. The converse applies: […]
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