Channel automotive COVID-19 support into green recovery, say CEOs

21 October 2020

21 October 2020

Leaders of the European Automobile Manufacturers’ Association (ACEA) are calling for coronavirus (COVID-19) recovery funds to be channelled into a green comeback. The association pointed out the industry was already at a critical juncture on the road to a carbon-neutral future, and now finds itself fighting the pandemic fallout.

To date, COVID-19 has led to automotive production losses of more than 4 million vehicles in Europe (valued at roughly €122 billion). Registrations of all vehicle types have plummeted over the first three quarters of the year, with ACEA predicting a record 25% drop in car sales for 2020. Now, as COVID-19 cases increase again across the continent, the potential for a sharp automotive recovery diminishes.

Biggest single risk

ACEA president and Fiat Chrysler Automobiles (FCA) CEO Michael Manley confirmed the scale of the risk in an online conference. ‘The COVID-19 pandemic is clearly the biggest single risk ever to face the automotive industry,’ he said. ‘It is adding massive pressures on our sector at a time when it is navigating fundamental technological shifts, as well as the prospect of a no-deal Brexit. We urgently need to find ways to pull through this with minimum damage to jobs and investments, while at the same time keeping a strong focus on the climate challenge.’

In mid-September, European Commission president Ursula von der Leyen outlined plans to increase the 2030 climate target from 40% of 1990 levels to ‘at least 55%.’ This was driven by a desire to reach continental climate neutrality by 2050, which Von der Leyen explained could not be achieved at current rates.

‘The European Commission’s recently-proposed 2030 Climate Plan will require massive additional investments from our side at this difficult time,’ Manley continued. ‘However, our investments alone will never be enough. If we want zero-emission mobility to become a real option for all Europeans, we also need a vast network of charging points and re-fuelling stations right across the EU, coupled with economically-sustainable incentives.’

Radical change

To reach this level, ACEA is calling for support from national recovery plans to be funnelled into infrastructure and incentives. The association hopes that this will help stimulate demand for alternatively-powered cars, vans, trucks and buses, which in turn will bolster Europe’s economic recovery as well as its climate ambitions.

New-car registrations in Europe do appear to have been buoyed by incentives in recent months. In September, Germany and Italy saw improvements, but as divergent national schemes lead to a patchwork recovery, the need for a more cohesive approach has become obvious.  Meanwhile, in June, executive vice-president of the Commission, Frans Timmermans drew attention to the financing of one million EV charging points, as well as clean fleet renewals and sustainable transport infrastructure.

‘Our industry is fully committed to carbon-neutral road freight transport by 2050 at the latest,’ said Henrik Henriksson, CEO of Scania and chairman of ACEA’s commercial vehicle board. ‘This will bring radical change for the commercial vehicle industry, as well as the entire value chain in transport and logistics. We are ready to lead this transformation.

‘Manufacturers have been investing in significant numbers of zero-emission trucks that will hit the market over the next few years. What we need member states to do now is to match our level of commitment by rolling out a network of truck-suitable charging stations,’ added Henriksson. ‘Backed by a fully coherent policy framework, making low- and zero-emission trucks the better option for transport operators, we can make this a success and turn the monumental challenges we are facing today into new opportunities.’