PSA Group CEO Says Proposed 2020 CO2 Fines In Europe Would Create “Chinese Trojan Horse”

Now that the other talking points have been mostly expended, PSA Group CEO Carlos Tavares has moved on to a last-ditch effort. He is arguing against the European Union’s planned 2020 carbon dioxide auto industry fines (if compliance with fleet-level fuel-efficiency goals aren’t met) by saying that such a course of action will “create a Chinese Trojan Horse.”

The PSA Group exec stated at a recent auto industry event that policymakers hadn’t realized that this “obvious” outcome would follow from the imposition of the European Union’s 2020 carbon dioxide fines against auto manufacturers that don’t meet a minimum fleet-level fuel efficiency.

Tavares went on to state that a major Europe-based auto manufacturer could be brought “to its knees” by such an approach, and as such it was dangerous.

I’ll note here that these plans are nothing new, and that auto manufacturers have had a long time now to make changes so as to remain in compliance. They haven’t done so for two main reasons: moving towards plug-in electric vehicles would lower their profit margins significantly; and the assumption of many was that fraudulent diesel car emission figures would partially help in meeting the goals.

Rather than argue that second point here, I’ll just note that a fair amount of real-world testing over the last few years has confirmed that (in practice) when it comes to diesel cars, you can either have legal pollutant emissions levels or you can have high fuel efficiency — you can’t have both. (See: Volkswagen Diesel Cars Use Up To 14% More Fuel After Software “Fix,” With NOx Emissions Still 400% Higher Than Lab Figures, Study Shows)

The exact comments made by the PSA Group CEO at the recent event were: “The impact is very obvious. It’s going to create a Chinese Trojan Horse in Europe.”

I guess that strategy makes a lot of sense from the perspective of the current political and cultural climate — if something happens or may happen that isn’t to your benefit, resort immediately to smears, scapegoating, and “fear the commies/fascists/reds/Huns/rednecks” style rhetoric. A better choice from the perspective of societal responsibility would likely be to simply make proactive changes — Europe’s air quality is fairly low, and improving fleet-level fuel efficiency is a way of improving it, so implement higher standards and enforce them. That being the case, why complain? Unless profit margins are all that matter anymore.

I’ll just note here that the PSA Group CEO is also the current chairman of the European auto industry lobby group ACEA, so he very likely is not speaking just for his own company but for the broader industry as a whole.

Continuing, Tavares stated: “If a European carmaker missed its (CO2) targets and was brought to its knees by fines, it could not be acquired by another big European carmaker purely because of antitrust rules.”

If this was to happen, Tavares argues, foreign investors would then have an opportunity to import the tech “imposed by European authorities, which means electric vehicles. … And who’s the leader in electrification? It’s the Chinese.”

A nice bit of scaremongering and deflection of blame, I suppose. What Tavares doesn’t note there is that PSA Group and most other European auto manufacturers have been doing nothing serious to date when it comes to plug-in electric vehicles. The strategy has seemingly been to just make a “big announcement” every few months or years (depending on the automaker) and then stall as much as possible afterwards. It’s no wonder that China-based firms seem to be on the expansion as of late — most firms in Europe and the USA have been caught sleeping. (I’ll note as an aside here, though, that the regions comprising what’s now India, Iran, and China have generally speaking been far and away the wealthiest parts of the “Old World” throughout history — the shift over the last few hundred years to Europe was pretty clearly an aberration, and one that seems to be on its way out.)

Reuters provides more: “His outspoken comments come against a backdrop of rising trade tensions between China and the United States and wider concerns about growing protectionism worldwide. They also underscore concerns about foreign influence over European manufacturers, jobs and technology, which have risen since China’s Geely snapped up 10% of Germany’s Daimler in February.

“Paris-based PSA, itself 12.2%-owned by China’s Dongfeng Motor Corp, has accelerated new vehicle development at Opel and Vauxhall after uncovering what Tavares described as hidden CO2 emissions problems following the brands’ acquisition from General Motors last year.

“Thanks to the extra investment, the group maintains it is now on track to meet CO2 goals averaging 95 grammes per kilometer being phased in from 2020-2021, backed by hundreds of millions of euros in potential fines for non-compliance. The current EU-mandated average for new cars is 130 g/km.

“Tavares has called for the EU penalties to be suspended until governments roll out adequate electric-car charging networks, saying last month he planned to raise the proposal at a meeting of Brussels-based ACEA on March 7.”

If the company is truly on track to meet the fleet-level carbon dioxide goals, though, then why would Tavares make so many of the recent comments that he has made? If the company’s plans regarding plug-in electric vehicles are serious, then why all the attempts to stall the fines?