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Between 2007 and 2009, cars sold in the European Union became much more fuel efficient. For diesel cars the gain was about 7 percent, while for petrol cars it was nearly 9 percent. This was good news for motorists because it meant lower running costs, writes Stephen Gardner.

The sudden improvements contrasted with relatively slow progress in the preceding years. Between 2002 and 2007, cars became 5 percent more efficient, according to European Environment Agency figures.

The speeding up in 2007 was down to European Union legislation. The EU decided that car manufacturers were too tardy in cutting the greenhouse gas emissions from their products, and so imposed a law, threatening to fine the big brands such as Volkswagen and Renault unless they meet certain standards for all of their cars by 2015. Since the law was put in place, manufacturers have been racing towards the goal. Since 2009, a further 7 percent fuel efficiency gain has been achieved.

Lower emissions from vehicles mean lower fuel costs because the shortest cut to lower emissions is to reduce the fuel that cars consume. The EU's top climate official, Commissioner Connie Hedegaard said legislation helped carmakers “stay focused on innovation”. Improvements “do not happen automatically, but because we are putting up targets and standards in Europe,” she said.

Now the EU is at it again. The European Commission, the EU's executive arm, has published draft legislation that will require carmakers to cut their emissions even more by 2020 – an improvement of about 30 percent compared to current levels. The Commission says the additional targets will save drivers about €340 in fuel costs per year, on top of the savings resulting from the 2015 target.

It all sounds like great news. An environmental group, Transport & Environment, has calculated that cars meeting the 2015 target will travel about 19 kilometres per litre of fuel, while in 2020 the figure will improve to 27km per litre.

Carmakers, however, are not so sure. The European Automobile Manufacturers’ Association said the 2020 targets would mean higher manufacturing costs, meaning higher prices for new cars. “The cost implications are huge,” said Ivan Hodac, the association's Secretary General.

But according to Transport & Environment, carmakers have a history of crying wolf. Before the 2015 targets became law, they said that cars would become unaffordable for some people, and that factories would close. In fact, carmakers have continued to make profits and cars have become cheaper. The price of a new car dropped by 13 percent in real terms between 2002 and 2010.

Even the industry itself seems to think that the 2020 targets are feasible. A report published earlier this year by an expert group, including representatives from the European Automobile Manufacturers’ Association, and from major carmakers, found that “technologies are available for meeting the 2020 targets and vehicle manufacturers and component suppliers have already invested in this area”.

Research published by the European Environment Agency shows that Citroen, Fiat and Toyota produce the most fuel-efficient vehicles and are already ahead of target. However, Daimler, Mazda and Nissan have work to do if they are to avoid the Commission's fines.

A version of this article was published in (A)Way Magazine.

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