EU Seeks to Balance Emissions Controls and Global Competitiveness

15 June 2015 Dashboard Insights Blog

The European Union has placed a growing emphasis on climate change policies in recent years, and the week of June 1519 marks the 10th annual European Union Sustainable Energy Week focusing on “sustainable mobility,” decarbonisation, and other energy topics. Earlier this year, the European Commission released its Energy Union proposal for the Paris Protocol, calling on an agreement and legally binding commitments to reduce global emissions by at least 60% by 2050. The proposal further built on the previous emissions law that the European Union passed  approximately two years ago, targeting significant carbon dioxide emissions by 2020.

In light of the increasingly strict emissions targets, the European Automobile Manufacturers Association  (ACEA) commissioned a study by FTI Consulting  analyzing the links between EU carbon emission regulation and the competitiveness of the EU automotive industry. ACEA’s concerns are particularly important for an industry that accounts for 12 million jobs and 4% of the European Union’s GDP, and which the European Commission describes as “crucial for Europe’s prosperity.”

Earlier this month, FTI Consulting released their report and concluded that the industry is “disproportionately affected by decarbonisation” as compared to other sectors of the economy, including other industries and manufacturers. Notably, the FTI report found that the cost of regulation has impacted profitability of the automotive industry, as automotive manufacturers are not yet passing the costs of complying with the regulation on to consumers. After release of the report, the ACEA called on the European Union to “make sure that ambitious climate change policies do not conflict with the need to protect jobs and growth in Europe.”

As previously detailed on this blog, the European auto industry posted strong gains over the past year. However, in May, Western European car registrations rose only 0.2%, signaling a slowdown in the recovery. The European auto industry will continue to closely watch the pace of recovery and economic gains, while considering ways to both comply with the emissions regulations and strengthen global competitiveness.

This blog is made available by Foley & Lardner LLP (“Foley” or “the Firm”) for informational purposes only. It is not meant to convey the Firm’s legal position on behalf of any client, nor is it intended to convey specific legal advice. Any opinions expressed in this article do not necessarily reflect the views of Foley & Lardner LLP, its partners, or its clients. Accordingly, do not act upon this information without seeking counsel from a licensed attorney. This blog is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Communicating with Foley through this website by email, blog post, or otherwise, does not create an attorney-client relationship for any legal matter. Therefore, any communication or material you transmit to Foley through this blog, whether by email, blog post or any other manner, will not be treated as confidential or proprietary. The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate, and or up-to-date. Foley makes no representations or warranties of any kind, express or implied, as to the operation or content of the site. Foley expressly disclaims all other guarantees, warranties, conditions and representations of any kind, either express or implied, whether arising under any statute, law, commercial use or otherwise, including implied warranties of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Foley or any of its partners, officers, employees, agents or affiliates be liable, directly or indirectly, under any theory of law (contract, tort, negligence or otherwise), to you or anyone else, for any claims, losses or damages, direct, indirect special, incidental, punitive or consequential, resulting from or occasioned by the creation, use of or reliance on this site (including information and other content) or any third party websites or the information, resources or material accessed through any such websites. In some jurisdictions, the contents of this blog may be considered Attorney Advertising. If applicable, please note that prior results do not guarantee a similar outcome. Photographs are for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Related Services