Brussels Softening on German Carmakers?

Accepting that large- and small-car makers should be treated differently, EU environment commissioner offers Germany's luxury marques a barter system

by Honor Mahony

The EU environment commissioner has indicated that he is willing to ease pollution-reducing targets for German car manufacturers so long as the general target across Europe is maintained.

Stavros Dimas told German daily Handelsblatt that he is willing to accept that large car and small car manufacturers contribute differently to the overall target of reducing carbon dioxide emissions to an average of 120 grammes per kilometre by 2012.

He said finding a compromise on the issue "is up to member states" opening the door to national capitals to barter on the matter, provided the target is reached.

This represents a significant win for the German car-makers—predominantly producing luxury makes such as Porsche, BMW and Audi—who had argued that they were being unfairly hit by Brussels' target.

"If the EU commission is now signalling flexibility in the burden sharing, then that is an important signal," Matthias Wissman, head of the VDA association of German car makers, told the newspaper.

However, it is unclear whether Mr Dimas' softer approach will lead to a deal between Germany and France—home to manufacturers such as Peugeot, which produce smaller, more emission efficient cars.

Berlin and Paris have been locked in dispute for months over how the new pollution targets should be met. Makers of smaller energy-efficient cars are against larger car manufacturers receiving softer targets.

German chancellor Angela Merkel and French President Nicolas Sarkozy in February agreed to the setting up of a working group to try and see if both sides could work out their difference—with no success to date.

"I would be very happy if member states and the European Parliament came to an agreement and the German-French discussions were part of this," said Mr Dimas.

A study published last year by Transport and Environment, a green lobby group, illustrated the pollution gap between car manufacturers in France and Germany.

According to the figures, German car groups in 2006 increased emissions of carbon dioxide from new cars sold by an average of 0.6%.

French and Italian groups, by contrast, cut emissions by an average of 1.6%.

France's PSA Peugeot Citroën emerged top of the fuel efficiency league among European manufacturers, with 142 grammes of CO2 emitted per kilometre, followed by Italy's Fiat, with 144g/km and France's Renault, with 147g/km.

German manufacturer DaimlerChrysler was bottom of the table, on 188g/km.

The current average across manufacturers is 160g/km.

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