It’s not easy being green, apparently. Successful German automakers BMW and Opel have both come out and stated that they need some kind of subsidy in order to properly comply with EU regulations on CO2 emissions.
Specifically, both automakers are concerned about the development and production of electric and hybrid vehicles. The development process is expensive and the finished product reflects that – which makes EVs and hybrids less attractive to the customer. BMW CEO Norbert Reithofer has said that while the federal government (Germany’s) wants a million EVs on the road by 2020, BMW has only sold 2000 in the past year. Only 100 of those were to private customers. He says:
“In order to increase sales despite the higher price tag, we need some sort of incentive, such as a tax break.”
Where Is The Bottom Line?
Opel’s Chief Technical Officer, Rita Forst, said that other countries have subsidies for EVs and hybrids (Americans get all sorts of tax breaks, for example). She also quite reasonably pointed out that automakers have to earn money on EVs if they’re going to produce them, and noted that if Europe really wants to move away from fossil fuels, that:
“…financial incentives are a logical consequence [of the shift away from fossil fuel]. The auto industry needs more and stronger support. It means nothing if there are only a few pilot vehicles and showcase projects. The customers are waiting for viable alternatives [to fossil fuels], but the sticker price is a pretty strong deterrent.”
But It Worked So Well Before
Reithofer expects that EVs and hybrids will have a combined market share of 7-15% by 2020, partly because the EU has high expectations for reducing carbon emissions. However, for BMW to drastically reduce its CO2 output (from a fleet-wide average of 148 g/km to 100 g/km) is a huge challenge, according to Reithofer.
In order to meet the EU’s carbon emission limits, BMW must build smaller cars, and equip its mid-size cars with 3-cylinder engines. Expanding its hybrid line-up is also in the cards – the i3 is supposed to go into serial production by the end of 2013. However, Reithofer apparently doesn’t think these measures will help BMW balance between emission regulations and building cars people will buy:
“It’s the most difficult for automakers who have been successful with the older technologies to transition to the new technologies.”
Any sympathy for the difficulties of BMW and Opel? Let us know in the comments, below.