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CDP auto emissions report

VW Isn’t the Only Car Maker Facing Billions in Emissions Fees

CDP auto emissions reportVolkswagen went to court last week over the emissions scandal. The US government is suing the automaker for cheating air pollution tests and VW faces fines that could total as much as $46 billion.

But Volkswagen may not be the only automaker on the hook for emissions failings. A report from CDP says the sector could face up to $4.8 billion in emissions penalties.

The report analyzes 15 of the world’s largest automakers with combined market capitalization of $846 billion. They are: Nissan, Renault, BMW, Toyota, Daimler, Honda, Ford, PSA Peugeot Citroen, Mazda, General Motors, VW, FCA, Hyundai, Tata Motors and Suzuki. These companies represent about 90 percent of the global auto market by sales volume.

It says US car giants General Motors and Ford are the most at risk — their emissions penalties could potentially equate to a combined $1.8 billion (114 percent of earnings before interest and taxes) and $1.2 billion (27 percent), respectively (see chart). “And that is before we factor in elements such as negative brand and reputational impacts,” says James Hulse, CDP’s head of investor initiatives.

Hulse told Environmental Leader that he does expect US and UK authorities to go after these car companies for emissions failings. To be clear, VW installed defeat devices in vehicles to beat emissions tests and then lied about it to authorities. These other automakers could face penalties for not complying with countries’ fleet emissions standards, not for lying to the feds.

“The VW scandal really highlighted the importance of more closely monitoring fleet emissions levels and that’s why we’re seeing tougher regulations and can expect penalties for non-compliance to be imposed,” Hulse says, adding that automakers can expect even stricter emissions rules in the future.

“In fact our research shows that global regulations need to become even tighter in order to align with science-based targets to limit global warming to a 2-degree rise,” he says.

The report says about 20 percent of the industry’s emissions come from the manufacturing stage. BMW, VW, Daimler and FCA were the only companies to receive an “A” grade from CDP on management of emissions at this stage of the process.

Four automakers have taken a lead on advanced vehicles — the report defines this to include battery electric vehicles, plug-in hybrid electric vehicles and fuel cell vehicles — which CDP says puts them at a competitive advantage, especially in light of the Paris climate deal. They are: Nissan, Renault, BMW and Toyota. And while Volkswagen receives an “E” grade — that’s the lowest — for fleet emissions following the emissions scandal, CDP gives it “A” grades in the advanced vehicles and manufacturing emissions criteria.

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3 thoughts on “VW Isn’t the Only Car Maker Facing Billions in Emissions Fees

  1. I suppose we should “thank” Volkswagen for have its pollution emissions scandal exposed because it will probably help expose the other 90% of global car companies to the same cheating.

    Much for the US System which relies upon so many companies to police themselves when it comes to reporting on pollutant emissions.

  2. If this is (has been) happening in the US, what about in the rest of the world, particularly in developing or third world countries where there are no controls/checks, if at all albeit quite limited I assume/think.

    Self-regulation is good, but of course it would have its limits/limitations.

  3. Although CDP’s disclosure programs (information requests/questionnaire) and its scoring methodology have evolved and become more and more inclusive and representative of the issues facing our lives, it must be noted that although the CDP initiatives or programs & ratings (disclosure, performance scores, A-list companies, etc) do improve transparency, and hopefully (trully) drive companies to improve their environmental performances,

    CDP’s scores companies ONLY based on the data in company responses. Neither CDP nor the scorers or report-writers verify (the data quality or accuracy; with the exception of verified emission figures by other 3rd-party verification companies contracted by companies themselves) the information in any individual company disclosures.

    The company responses are however publicly available and shared with CDP’s investor signatories, whether the response is made available to the public or not, therefore, such responses are subject to public scrutinity, and critical to the investors decision making. With this, it is hoped that companies will provide data and information that is as complete, accurate and reflective of the their current strategies, actions, and risk management as possible.

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