Daimler, FCA Warn on Europe’s CO2 Targets

The CEOs of Daimler AG and Fiat Chrysler Automobiles NV say their companies may fall short of Europe’s carbon dioxide emission limit for 2021 because of tepid demand for electric cars, the Financial Times reports.

Carmakers had been banking on continued strong demand for diesels to help them achieve the EU’s CO₂ emission target of 95 grams per kilometer. The industry averaged 118 g/km in 2016.

But diesel sales are falling fast because of emerging concerns about their emissions of nitrogen oxides. Last year gasoline-fueled vehicles outsold diesels in Europe for the first time since 2009.

EVs could offset the impact of the slump. But FCA’s Sergio Marchionne says that isn’t likely without subsidies and government mandates that force EV sales, FT reports. Daimler’s Dieter Zetsche voices similar concerns, warning reporters at the Detroit auto show, “I can’t guarantee we will be compliant.”

Failure to meet the EU emission target would result in fines of €95 ($117) per gram above the 95 g/km limit, multiplied by the number of vehicles sold. Marchionne cautions that some carmakers could simply stop selling certain models to avoid triggering sanctions.