In a significant milestone for the automotive industry, all car manufacturers in the European Union (EU) have met the CO2 emission targets for 2023, according to preliminary data from the European Environment Agency. The average emissions fell by 1 g/km compared to 2022, marking a decrease of 1.5%. This achievement underscores the industry’s commitment to reducing its carbon footprint amidst stringent regulatory pressures.
The data reveals that 10.7 million new cars sold in 2023 had average CO2 emissions of 107 g/km, as measured by the Worldwide Harmonized Light Vehicles Test Procedure (WLTP). This figure represents a modest but crucial step towards the EU’s ambitious climate goals.
Historical Context and Trends
The pace of CO2 emission reductions has varied over the years, with reduction rates generally accelerating as deadlines approach. Between 2000 and 2007, before the first standards were agreed in 2008, fleet CO2 emissions declined by an average of 1.9 g/km per year. From 2008 to 2015, manufacturers exceeded the annual reduction rates required to meet the 2015 target of 130 g/km, with average CO2 emissions dropping by 4.9 g/km per year.
However, from 2015 to 2019, with no stricter targets in place before 2020, average CO2 emissions increased by 0.7 g/km per year. A significant turnaround occurred from 2019 to 2020, when emissions dropped by an average of 14 g/km. All manufacturers met the 2020 target of 95 g/km using flexible compliance mechanisms.
In 2021, the transition from the New European Driving Cycle (NEDC) to WLTP took place, requiring another significant drop in fleet-average CO2 emissions to meet the equivalent WLTP target. Since 2021, manufacturers have faced little pressure to further reduce CO2 emissions until the next round of targets in 2025–2029. As a result, 2022 and 2023 reductions occurred at a slower pace.
Manufacturer Performance
Car manufacturers can pool together several brands to meet CO2 targets. Data for nine manufacturer pools, representing approximately 94% of all new passenger car registrations in the European Economic Area in 2023, shows that all pools are expected to have met their 2023 CO2 targets, even without using flexible compliance mechanisms. Eco-innovation technologies lowered CO2 emission levels by 0.4 to 2 g/km.
Fuel Type and Technology Trends
The uptake of electric vehicles (EVs) increased from 2022 to 2023. The share of battery electric vehicles (BEVs) grew by 2.1 percentage points (from 13.4% to 15.5%), whereas the share of plug-in hybrid electric vehicles decreased by 1.8 percentage points (from 9.6% to 7.8%).
Norway continues to dominate the European BEV market in terms of market penetration, with more than 83% of new car registrations in 2023 being BEVs. Most manufacturer pools had a BEV share above 10% in 2023, led by BMW with almost 20%. Ford, Mazda, and Subaru-Suzuki-Toyota were the only pools with BEV registration shares below 5%.
Country-Specific Differences and Compliance Strategies
The briefing also examines country-specific differences and compliance strategies. While Norway leads in BEV adoption, other countries are making strides in various fuel types and powertrain technologies. The compliance strategies employed by manufacturers vary, with some relying more heavily on eco-innovation technologies and others on the adoption of BEVs.
Looking Ahead
As the industry gears up for the next round of targets in 2025–2029, the focus will be on sustained innovation and the adoption of cleaner technologies. The success in meeting the 2023 targets is a positive sign, but the challenge remains to maintain this momentum in the face of evolving regulatory landscapes and market dynamics.
The automotive industry’s ability to meet these targets will be crucial in the global effort to combat climate change and transition to a more sustainable future.
