SUVs pose a green conundrum

Daimler boss Dieter Zetsche, launching Mercedes- Benz's new cross country vehicle GLC 350e 4matic on Wednesday, had declared 2015 the "year of the SUV".
Daimler boss Dieter Zetsche, launching Mercedes- Benz's new cross country vehicle GLC 350e 4matic on Wednesday, had declared 2015 the "year of the SUV".PHOTO: EUROPEAN PRESSPHOTO AGENCY

Carmakers are facing difficulties meeting European emission rules as petrol-guzzling SUVs become the car of choice

London - Petrol-guzzling sport-utility vehicles (SUVs) may be driving Europe carmakers up a strategic cul-de-sac.

SUVs are big, tough and designed for heavy-duty tasks most of them never perform.

They are also the automotive industry's hottest properties, delivering strong growth and rich margins. Even the Rolls-Royce and Lamborghini marques are developing their own SUVs.

They are also giving carmakers a green problem. They are making it more difficult to meet tightening European emission guidelines.

SUVs have bigger engines than popular cars of the past. They burn about 25 per cent more fuel than comparable sedans.

European regulations already stipulate that average CO2 emissions must fall from 130g to 95g for each kilometre by 2021. Carmakers which miss these targets face hefty fines.

Policymakers in Brussels, meanwhile, are already mulling stricter limits after 2021. Data published by the German statistical office on June 11 points directly to the problem.

The SUV surge pushed up the average engine size of cars sold in Germany by 11 per cent, to 137 horsepower, between 2005 and 2013. There was a 3.6 per cent increase in the average driver's annual mileage too.

As a result, carbon emissions from German private cars decreased by only 1.6 per cent from 2005 to 2013.

Had the average engine size remained constant, they would have been 12 per cent lower.

The industry is already under scrutiny because fuel consumption figures for cars on the road are out of kilter with laboratory tests.

Last year, they were 38 per cent higher, a study by the International Council on Clean Transportation revealed. In 2001, the gap was just 8 per cent.

German premium carmakers are in a particular bind. Their bias towards high-emission vehicles makes it harder for them to meet the emission targets in the first place. Some are expanding their product ranges.

But Daimler boss Dieter Zetsche declared 2015 the "year of the SUV", while Mr Martin Winterkorn of Volkswagen outlined what he called the brand's "largest-ever SUV offensive".

In Germany alone, annual SUV sales will double to 900,000 by 2020, the Duisburg-based Center Automotive Research forecasts.

The popularity of SUVs is boosting carmakers' short-term profit. But they may soon be obliged to apply the brakes.

Reuters

A version of this article appeared in the print edition of The Straits Times on June 20, 2015, with the headline 'SUVs pose a green conundrum'. Print Edition | Subscribe