EU races towards electric vehicle adoption with new CO2 limits for cars
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EU races towards electric vehicle adoption with new CO2 limits for cars

The European Union (EU) is taking climate change very seriously. A recent vote in the EU parliament has seen new caps on carbon dioxide approved that, law makers hope, will spur on the trend towards electric vehicles, cleaning up roads and the atmosphere. Europe is not, of course, alone in encouraging the transition away from fossil fuels and towards electric vehicles. China and other major powers are following suit.

Chinese battery specialist and electric bus maker BYD has seen its share price gain 3% over the past 5 days

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Source: Yahoo Finance

Compared to the 2021 limit previously set, Europe’s new 2030 limit will require a further reduction of 37.5%, if politicians want to meet their targets. That’s a significant cut, and no one expects it to happen all at once. Voting in Strasbourg, France, last Wednesday, the assembly put a 15% reduction goal in place for 2025. The proposal is set to undergo a “final adoption” on 15 April – but this is a formality. And the vote was a landslide in favour, with 521 voting for, and just 63 against. There were 34 abstentions.

Rapporteur Miriam Dalli told the press: “As Parliament, we strongly fought to safeguard the environmental integrity of the proposal and bring real health, consumer and innovation benefits to European citizens. We achieved this legislation, despite fierce opposition from the car industry and certain Member States, which refused to acknowledge the opportunities that stem from a more ambitious target.”

Around 15 million autos are sold in Europe annually, and they account for more than 10% of the bloc’s CO2 emissions. At the same time, electric vehicles currently command just 1.5% of the market. If lawmakers (and electric vehicle makers) get their way, that’s a number that’s set to rise dramatically over the coming decade!

Disclosure

Dominion holds BYD, a Chinese maker of electric vehicles and batteries that exports fleets around the world, including to Europe, in its Global Trends Managed Fund.


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