No Matter What Trump Does, Big Cities Pressing for Cleaner Cars
(Bloomberg) -- The auto industry can’t count on a rollback of environmental standards by U.S. President Donald Trump to escape increasing worldwide pressure to make vehicles cleaner.
Rather than national and international bodies, the big push for change is coming from urban centers like Paris, Seoul and Mexico City, and U.S. states such as California, where leaders are reacting to the health hazards caused by deteriorating air quality.
“The air in London is lethal and I will not stand by and do nothing,” Mayor Sadiq Khan said in April as he announced plans to set up an ultra-low emissions zone around the city center.
Automakers can’t afford to ignore these initiatives, especially as a growing slice of the world’s population crowds into urban areas. The push by cities gained momentum in the wake of Volkswagen AG’s emissions-cheating scandal, which highlighted the smog-causing nitrogen oxides emitted by diesel vehicles. Madrid, Athens, Paris and Mexico City have all said they will ban these vehicles from their roads by 2025.
“Electric cars are the main driver of our technology effort because we are seeing many cities, urban cities, which are going to be zero-emissions and because the most affordable, known, popular technology is going to be electric,” Carlos Ghosn, chief executive officer of French carmaker Renault SA and chairman of Japan’s Nissan Motor Co., said in an interview.
In the U.S., 30 cities including New York and Chicago asked automakers for the cost and feasibility of providing 114,000 electric vehicles, including police cruisers, street sweepers and trash haulers, to improve air quality and show demand for low-emission vehicles.
California, the biggest auto market among U.S. states, is seeking to tackle urban air pollution by sticking to stringent emissions standards and promoting zero-emission cars with measures like a $7,000 “clean vehicle” rebate. A dozen other states, including New York, follow California’s standards.
These initiatives present a challenge for automakers seeking to predict the mix of technologies needed for the future, PSA Group CEO Carlos Tavares said at the company’s shareholders meeting on May 10.
“Decisions that were made have an influence on diesel use in a certain number of regions, notably in urban regions, and change consumers’ perception,” said the head of the maker of Peugeot and Citroen cars.
Cities are also teaming up in the effort to improve air quality. London and Seoul joined Paris in a plan to provide independent measurements of car emissions to gauge real-life pollution more accurately than assessments by other authorities.
Meanwhile, Trump is considering whether the U.S. should remain in the UN-sponsored agreement struck in Paris by 200 countries two years ago. The accord aims to limit global warming by reducing greenhouse gas emissions -- including from autos. Outdoor air pollution leads to more than 3 million premature deaths a year, according to a study published in the journal Nature.
For local governments, the issue is immediate and personal, said Emmanuel Bulle, who manages Fitch Ratings’ European manufacturing team. “A few cities alone aren’t recasting the strategy of carmakers, but rather, decisions made by cities illustrate a mega-trend toward cleaner vehicles that manufacturers will have to incorporate in their strategy.”
Here are some of the steps taken by five cities to curb auto emissions:
- The most polluting vehicles were banned from the city center during periods of peak smog and older cars can’t drive along roads like the Champs-Elysees at all during weekdays. To facilitate controls, cars must display a sticker showing pollution levels.
- The French capital set up financial incentives, including discounted public transport, for drivers willing to give up their old vehicle. Paris also closed highways along parts of the Seine river, freeing up the waterfront for cyclists and pedestrians.
- To access London’s crowded center during weekdays, drivers must pay 11.50 pounds ($14) daily. The mayor now plans to create an Ultra Low Emission Zone where older vehicles that don’t meet recent EU emission standards will be forced to pay an additional 12.50-pound fee from April 2019, including at night and during weekends.
- London’s mayor, whose city has received warnings from the EU about its pollution levels, also urged the U.K. government to set up a plan to scrap diesel vehicles by providing subsidies for owners of polluting cars who agree to swap for cleaner vehicles.
- The German city, home to Mercedes-Benz parent Daimler AG and the maker of Porsche sports cars, is planning a ban on diesel engines that don’t comply with the most recent European standards during periods of peak pollution.
- Air quality has improved since the city introduced a program named ‘Hoy No Circula’ -- or ‘No-Drive Days’ -- restricting circulation based on license plate number. Less-polluting cars, identified with a sticker, are exempt from the restrictions.
- Vehicles licensed in the city must undergo emission testing twice a year. The 20 million residents of Greater Mexico City typically wake to a blanket of smog so thick it cloaks volcanoes as high as 18,000 feet that ring the capital.
- In Japan, where diesel engines peaked in the 1980s, accounting for as much as 6 percent of new car deliveries, legal action from residents forced Tokyo’s government to introduce particle-emission rules more than a decade ago.
- The city started requiring diesel owners to install exhaust gas purifiers in 2003 and barred those that didn’t from driving. By 2007, no Japanese carmaker was producing diesel models at home. The technology recently made a comeback as improved filters, turbochargers and fuel injection helped smooth its sooty image. Still, diesel cars represented less than 2 percent of vehicles sold in Japan last year.
Michael Bloomberg, founder and majority owner of Bloomberg LP, parent of Bloomberg News, is the United Nations Secretary General’s Special Envoy for Cities and Climate Change. He’s also president of the board of C40 Cities, a group of cities that will work with the International Council on Clean Transportation and Emissions Analytics to measure vehicle emissions with remote sensors and portable emissions monitoring equipment. Bloomberg Philanthropies is one of the funders of C40.