Car Clash Germany Blocks CO2 Reduction Deal

There were threats, lobbying and even a call from Chancellor Merkel to the Irish prime minister. In the end, Germany got its way and managed to delay an EU decision on lowering the amount of CO2 European-made cars may emit.
Cars made in Europe may soon have to reduce their emissions.

Cars made in Europe may soon have to reduce their emissions.

Foto: Oliver Berg/ dpa

Germany has long seen itself as a leader when it comes to efforts to reduce CO2 emissions and combat climate change. Indeed, Chancellor Angela Merkel's government remains committed to radically expanding its reliance on renewable energies in the coming decades.

But when it comes to reducing the amount of greenhouse gases German-made automobiles  produce, Berlin is far less ambitious. And this week, Merkel managed to block the adoption of new emissions limits for cars produced in the European Union . Stricter caps, she insisted, could severely handicap Germany's automobile industry, focused as it is on the luxury car sector.

EU member states on Thursday had been set to rubber-stamp a deal hammered out on Monday evening between the European Council -- led by Ireland as current holder of the rotating EU presidency -- and the European Parliament. The agreement foresees the reduction of a company's fleet-wide CO2 emissions from 130 grams to 95 grams per kilometer by 2020.

But Berlin undertook a flurry of lobbying this week, with Merkel even calling Irish Prime Minister Enda Kenny on Wednesday in an effort to have the issue removed from the agenda of the Thursday meeting of ambassadors to the EU from the 27 member states. Others in Berlin also sought to delay the vote so as to give Germany time to assemble enough allies to block the deal. In the end, the effort was successful and a decision on the item was delayed until October.

A Threat from Berlin

According to the German newswire DPA, diplomats from Berlin had threatened that the German automobile industry would be forced to move out of Europe if the stricter emissions levels were passed. On Wednesday, the Economics Ministry appeared to make the same threat in comments to Reuters. "Many jobs are dependent on the automobile industry," a ministry spokesperson told the news agency. "It is an important factor for Germany's competitiveness. The EU has clearly said it wishes to place Europe's competitiveness in the foreground. As such, we need decisions from Brussels that conform to this ambition."

The delay will give Berlin more time to assemble a blocking minority to weaken the CO2 limits. By October, Croatia will have become a full EU member and observers believe the country could join Germany. Furthermore, Ireland will no longer hold the rotating EU presidency; Lithuania is set to take over. That too could make a difference.

Prior to Thursday, Germany had only been able to garner the support of Slovakia and the Czech Republic, both countries that have become increasingly dependent on the automobile industry in recent years.

Carmakers in other European countries, such as Italy and France, would have an easier time meeting the new limits because of the smaller average size of the vehicles they produce. Even so, they too would have some work to do. According to Germany's Federal Motor Transport Authority, even such small-car producers like Renault, Peugeot and Fiat still have an average fleet output of over 130 grams of CO2 per kilometer. BMW is currently over 140 grams per kilometer and Mercedes stands at 153. The Volkswagen fleet emits an average of 139.2 grams per kilometer.

'A Scandal'

European Union diplomats had voiced anger with German efforts to torpedo the deal. "It is a scandal," one unnamed diplomat told DPA on Wednesday.

There are many in Germany who are likewise unsettled by the government's position, particularly the similarity between the position taken by Merkel and that represented by the automobile industry. Merkel has demanded that automakers be allowed to "bank" credits for the production of electric cars prior to 2020. The current deal only allows electric cars to offset CO2 emissions for the period after 2020. Furthermore, Berlin wanted electric cars to be calculated at a ratio of 3 to 1 instead of the 1.3 to 1 ratio proposed by the Commission.

That position is virtually identical to the position adopted by the German automobile industry, which has heavily lobbied Merkel in recent weeks.

cgh -- with wire reports