Guy Robson discusses COP26 and the future of emissions

Partner Guy Robson discusses Cop26 and the future of electric vehicles, along with the potential impact on emissions, in The Times.

Guy’s article was published in The Times, 25 November 2021, and can be found here.

Shortly before COP26, organisations as diverse as Boston Consulting Group and Greenpeace reached the same conclusion: in order to meet climate targets, at least 90% of new passenger vehicles must be electric by 2030. But just as world leaders took different views in Glasgow on the future use of fossil fuels, so did major vehicle manufacturers over their electric vehicle (EV) timetable.

Pledges from the world’s leading car makers vary by region with most stopping well short of the 90% target: some of the leading vehicle manufacturers that have either been found to have cheated emissions testing or that are facing legal action from consumers in relation to dieselgate have not committed to meet it. At COP26, the world’s major vehicle manufacturers were asked to sign a declaration to “work towards reaching 100% zero emission new car and van sales in leading markets by 2035 or earlier”. Whilst some vehicle manufacturers, including Ford and Jaguar Land Rover, agreed to sign, some of the biggest names in the industry, including Volkswagen and Renault-Nissan, chose not to sign. Still fighting emissions claims in multiple jurisdictions, including the UK, these companies are in danger of failing a future generation by not doing enough to quickly reach zero emissions.

The numbers are all over the place. Although the UK government plans to ban sales of all new petrol cars and most hybrids by 2030, President Biden has announced a very different US national target: in 2030, EVs will comprise half of all new vehicle sales. By the same 2030 deadline, Volkswagen anticipates that 70% of its European vehicle sales (but only 50% of its US and China sales) will be EVs, Ford has announced that all vehicles sold in Europe will be electric, and Mercedes is going 100% electric ‘where market conditions allow’. To its credit, Volvo plans to sell only electric cars in all its markets by 2030.

A significant contributor to climate change, vehicle emissions are a global problem that affects us all. Global car manufacturers should therefore adopt a global approach to trying to resolve it. A move away from manufacturing vehicles that burn petrol or diesel is an obvious one and the success of Tesla in the EV market shows that it is also a lucrative and popular one. The major vehicle manufacturers still have a long way to go to displace Tesla, although Audi, GM and Ford are gaining market share in the US.

However, rather like their EV strategy, their approach to settling legacy dieselgate issues is also inconsistent and is being done through a series of disconnected local prisms.  Some car manufacturers are exploiting differences in legal regimes in order to defend emissions claims from their customers that they are settling elsewhere.

For example, Mercedes-Benz’s parent company, Daimler, agreed a c.$1.5 billion settlement over emissions in the US while Volkswagen has agreed settlements with US and German claimants in relation to diesel emissions issues. By contrast, both Mercedes-Benz and VW are making their UK customers litigate in the High Court in order to seek damages, doubtless hoping that protracted legal proceedings will deter further customers from coming forward to join the claim.

In their EV planning, many of the giant vehicle manufacturers are not going far enough or fast enough: they use different standards in different countries to address what is a global challenge. Regrettably, they are still fighting emissions cases using comparable tactics, treating the UK and other jurisdictions differently. The eyes of the world were watching COP 26 and history will judge those manufacturers that begrudge doing any more than the bare minimum only when they are compelled to do. It is time that the global car giants started to manage their emissions strategies with a global world-view.