Ban diesel cars?

German Chancellor, Angela Merkel has revealed in an interview that the country may ban diesel and petrol cars in the future.

Background

During the late 19th century and the early 20th century, electric cars were popular among the public. However, they were replaced when the much-cheaper gasoline vehicles were introduced to the markets. It was only after 2008, when the market for electric vehicles began to grow. This was due to two main reasons –concerns over growing oil prices and about the environment.

According to a World Health Organization report, 92% of the world’s population lives in places where air pollution exceeds safe limits. Many nations have established tax cuts and subsidies to promote electric vehicles. In the European Union, as of 2011, 15 member-states provided economic subsidies in varying degrees.

Most electric vehicles use lithium-ion batteries.

Analysis

In July 2017, the governments of France and UK announced that by 2040, petrol and diesel cars would be banned. UK, especially, has been grappling with increased levels of pollution. The Indian government has also announced that by 2030, every vehicle will be powered by electricity.  

In 2017, Volvo became the first car manufacturer to announce that from 2019, every new car in its range will have an electric power train. Other companies like Tesla too have followed suit and have begun making significant investments in manufacturing electric cars.

According to Merkel, a specific deadline has not been decided upon to make the shift from petrol and diesel cars to electric cars. She said, “I cannot name an exact year yet, but the approach is right because if we quickly invest in more charging infrastructure and technology for electric cars, a general changeover will be structurally possible.”

Merkel’s announcement is significant as Germany has one of the largest automotive industries in the world. It is also the third in the production of cars. Diesel car manufacturers like Volkswagen have recalled their cars for software updates to ensure safe levels of diesel emissions. Merkel, who is seeking a fourth term as Chancellor, has been criticized for not doing enough to curtail air pollution levels. In the interview, she added that the country may not be able to hit its environment targets noting, “It is also clear that the climate targets we have set for 2050, namely a reduction in CO2 [carbon dioxide] of 80-95%, are very ambitious even if vehicle emissions of CO2 are significantly reduced.”

German towns like Stuttgart have already taken the independent step to curtail the number of diesel cars on the roads.

Assessment

Our assessment is that Germany’s announcement will prove to be another boost for the adoption of electric vehicles. However, without a set deadline, this runs the risk of not being implemented. Governments across the world should be focusing on addressing increased air pollution levels. What is interesting would be the impact on such a move on countries like India.

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Big oil’s electric problem