Europe’s top 13 car makers will face fines of up to €14.5bn (£12.4bn) for missing their 2021 emissions targets, according to a new forecast from PA Consulting.
After four years of decreasing emissions, a rise in the number of customers buying SUVs, stronger demand for high-powered cars, and a shift in preference to petrol cars has seen emissions climb.
Volkswagen could be hit by a fine of as much as €4.5bn as a result of its high sales volumes across Europe.
In terms of profit, Jaguar Land Rover on track for the biggest blow, with a fine of €93m forecast, equivalent to 400 per cent of the companies 2018 profit.
Other previously high performing manufacturers such as Volvo, Renault-Nissan-Mitsubishi, and even hybrid vehicle market leader are set to fall short.
Michael Schweikl, automotive expert at PA Consulting, says: “Despite this ‘four steps forward, one step back’ situation, the good news is that there are many options open to car makers to reduce emissions and minimise future fines. But the urgency of the situation means they have to act quickly.”
Schweikl suggests that firms could take measure such as discounting EV and hybrid vehicles, as well as exploring mergers with other companies, in a bid to take high-polluting vehicles off the market.
PA’s analysis ranks each manufacturer against their carbon dioxide emissions forecast for 2021.
The challenge is daunting, with carmakers needing to sell more than 2.5m additional EV cars in order to meet their targets, a 1280 per cent increase by 2021.
In terms of countries, Norway and the Netherlands were alone in reducing emissions, with the former way out in front with sales of electric vehicles making up 31.2 per cent of new car sales.
In the UK, by contrast, the sale of such vehicles made up only 0.7 per cent of such registrations.