FEDERAL CHAMBER OF
AUTOMOTIVE INDUSTRIES
Tm Reardon: Director Government
Policy
Global Fuel Economy Initiative
2 March 2011
BAD DATA = BAD POLICY
GOOD DATA = GOOD POLICY
SOURCE: SAPERE RESEARCH GROUP
FLAWED INTERNATIONAL COMPARISONS
INTERNATIONAL COMPARISONS
2009 CO2 Outcomes:
• UK= 149 Grams of CO2/km
• Australia 219 Grams of CO2/km
• Adjusted for:
• Market Segment: 199 Grams CO2
• Fuel Type: 175 Grams of CO2
• Vehicle Size: 156 Grams of CO2
• Other factors:
• Auto Transmissions
• Fuel Quality
AUSTRALIAN POLICY FRAMEWORK
24 July 2010, Election Commitment:
• Mandatory CO2 Target.
27 January 2011, PM announced:
• Abolition of the CCR.
• Capping of the LPG Vehicle Scheme.
• Abolition of the GCIF.
24 February 2011, PM announced:
• A carbon price from 1 July 2012.
• Transportation fuels incorporated.
MOTOR VEHICLE CO2 EMISSIONS: POLICY ELEMENTS
Congestion Pricing
Carbon Price
(ETS, Carbon tax)
Fuel Excise
Green Car
Innovation
Fund
Vehicle CO2
Emissions
Standard
Reducing CO2
Emissions
from Motor
Vehicles
Fringe Benefits
Tax
Luxury Car
Tax
BELT
OR
BRACES
Carbon Price Vs Carbon Standard:
•
A carbon price can efficiently determine the least cost
method of emissions abatement.
•
Secondary emission strategies, such as Mandatory
Standards, assume that a reduction of one tonne of
C02 from a passenger motor vehicle is more
important than a reduction of one tonne of C02 from
any other sector of the economy.
NEW VEHICLE FUEL EFFICIENCY
1. History of PMV CO2 Emissions
2. Forecast CO2 Emissions
3. CO2 Price and/or CO2 Standard
4. Design Options for a Standard
5. Taxation Issues
NAFC/NACE TARGETS
1983 = 9.5 Litres/100km
1990 = 9.0 Litres/100km
2000 = 8.2 Litres/100km
20?? = 6.8 Litres/100km
2010 = 222 Grams of CO2
FUEL CONSUMPTION TARGETS
(PETROL PASSENGER ONLY
AND
11
10.5
9.5 l/100km
10
Litres per 100 km
9.5
9
8.5
9.0
l/100km
8
7.5
7
6.5
6
8.2
l/100km
RESULTS
NATIONAL AVERAGE FUEL CONSUMPTION
2010 TARGET
2010 Target = 222 grams of CO2
• All Fuel Types.
• All vehicles under 3.5 tonne.
• 2010 outcome = 212.6 grams
of CO2.
HISTORICAL FUEL CONSUMPTION
EMISSIONS
AND
CO2
12
340
Average Fuel Consumption: Petrol Passenger
320
11
Average CO2: All Fuel Types
Litres/100km
280
9
260
8
240
7
6
220
200
Grams CO2/km
300
10
CHANGE IN NACE: SEGMENT CHANGE VS
VEHICLE TECHNOLOGY (INCLUDING FUEL)
7.0
6.0
Grams CO2/KM
5.0
4.0
3.0
2.0
1.0
0.0
2007
2008
2009
2010
Technology
3.3
1.9
3.1
3.7
Segment Change
1.1
1.8
0.8
2.3
MARKET SEGMENTS
BY
MARKET
SHARE
70%
60%
50%
40%
30%
20%
10%
0%
Total Passenger
2006
Total SUV
2007
2008
Total LCV
2009
2010
VEHICLE TYPE
BY
MARKET
SHARE
25%
20%
15%
10%
5%
0%
Light
Small
Medium
2006
Large
Upper
Large
2007
People
Movers
Sports
2008
SUV
SUV
Compact Medium
2009
SUV
Large
2010
SUV
Luxury
FUEL TYPES
BY
MARKET
SHARE
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Petrol
2006
Diesel
2007
2008
Hybrid
2009
2010
TARGET ACHIEVED, WHAT NEXT?
July 2010:
• Mandatory NACE Target
• 2015 = 190 grams of CO2
• 2024 = 155 grams of CO2
0.8%
ae
ro
dy
na
m
ic
s
1.3%
ty
re
s
1.7%
Im
pr
ov
ed
re
si
st
an
ce
ei
gh
tin
g
1.0%
Lo
w
tio
n
0.8%
Li
gh
tw
m
ec
h.
fri
c
0.4%
br
ak
in
g*
2.0%
ed
uc
ed
2008-2015
R
0.5%
ra
ti v
e
1.0%
St
op
-s
ta
rt
2.0%
eg
en
e
3.0%
R
Pe
t ro
ld
ire
ct
in
je
D
ie
ct
se
io
n
ld
ire
ct
Va
in
ri a
je
ct
bl
io
e
n
va
lv
e
Sm
ac
tu
al
at
le
io
rc
n
ap
ac
ity
D
ua
en
lc
gi
ne
lu
tc
s
h
tra
ns
m
is
si
on
TECHNOLOGY DERIVED EMISSIONS SAVINGS
2008-2020
3.5%
2.9%
2.5%
2.5%
2.0%
1.7%
1.5%
1.3%
1.0%
1.0%
0.8%
1.0%
0.8%
0.5%
0.1%
0.3%
0.0%
0.0%0.0%
MARKET SEGMENT CHANGES
2008
60%
2015
2020
56.7%
50%
45.3%
39.3%
40%
30%
20%
14.2%
13.2%
13.8%
14.4%
10.8%
11.8%
11.5%
6.0%
7.0%
0.5%
0.0%
ve
hi
cl
e
E
le
ct
ri
se
lL
C
ie
D
se
lS
U
c
V
1.3%
se
lp
as
s
ie
6.4%
V
1.4%
H
yb
rid
V
P
et
ro
lL
C
V
P
et
ro
lS
U
r
P
et
ro
lp
as
se
ng
e
5.7%
ie
0.0%
0%
3.7%
1.3%
D
3.0%
en
ge
r
5.6%
LP
G
6.8%
11.2%
6.1%
D
10%
3.0%
EFFICIENCY GAINS
V
MASS INCREASES
1%
Technology improvements:
• Lightweighting
• Aerodynamics
• Reduced mechanical friction
• Low friction tyres
Weight gains
• Safety
• Emissions
• Noise
• Quality
• Comfort
-0.7%
PROJECTED CO2 EMISSIONS: NACE
230
222.4
220
210
202.1 (9.1%)
200
189.4 (14.8%)
190
194.6 (12.5%)
180
170
176.1 (20.8%)
160
150
2008
2009
2010
2011
2012
2013
No change in market segments
2014
2015
2016
2017
2018
Applying market segment projections
2019
2020
CO2 TARGETS: ECONOMY WIDE
TARGETS
Australian Government target of 5% to 25%
reduction in CO2 emissions by 2020 based on
2000 levels.
• 2000 = 260 g/CO2
25% reduction
• 2020 = 195 g/CO2
CO2 EMISSIONS COMPARISON:
EUROPE AND AUSTRALIA
105
European % CO2 Reduction
100
Australian % CO2 Reduction
95
90
85
80
75
70
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
FLEXIBILITIES
•
Credits for:
1. Low emission vehicles
2. Eco-technologies
3. Alternative fuels
•
Phase-In from 2015
•
Averaging and Pooling
•
Make Good Provision
(Banking/Borrowing)
OPTIONS
FOR
BURDEN SHARING
1. Industry Target.
2. Vehicle based approach: Standard set
which vehicle must achieve in order to
enter the Australian market.
3. Corporate Average: Each brand
provided a target CACE:
• All brands to achieve 195 grams.
• Uniform Percentage Reduction.
• Parameter based target.
UNIFORM PERCENTAGE REDUCTION
300
Ford
2005
Grams CO2
280
Jaguar
260
2006
Kia
2009
240
2015 (2005
base)
2015 (2006
base)
220
200
180
0
2
4
CORPORATE SPECIFIC MASS TARGET
480
Ferrari
430
Lamborghini
380
Bentley
Aston Martin
Rolls Royce
Maybach
CO2 grams/km
Maserati
330
280
Holden
Jaguar
230
Lotus
180
130
Toyota
BMW
Mazda Audi
Renault
Kia
VW
Honda
Suzuki
Hyundai
Citroen
Proton
Skoda Mini
Fiat
Alfa
Land Rover
Porsche
Chrysler Jeep
Ford
Nissan
Lexus Dodge
Subaru
Mitsubishi
Mercedes
SSangyong
Isuzu
Peugeot
Smart
80
800
1300
1800
2300
Mass Kgs
2800
3300
Reducing
emissions
–
AnCO2
integrated
approach
– integrated approach
Delivering majority of
new car CO2 reductions
Influencing demand in a
harmonised way
Sustainable production
Reducing congestion
29
FBT: KILOMETRES
TRAVELED
FBT: REVENUE ESTIMATES
LUXURY CAR TAX: INCREASING INCIDENCE
Passenger Cars
SUV's
Total PMV & SUV
27
16.5
19
18.5
14
9
6.5
2.5
11
8
9
2.5
1979
2003
2007
2010
AUSTRALIA’S TOP SELLING LUXURY CARS
Rank
1
2
3
4
5
6
7
8
9
10
Model Group
Toyota Prado
Toyota Landcruiser Wagon
Holden Commodore
Mercedes-Benz C-Class
Mitsubishi Pajero
BMW 3 Series
BMW X5
Toyota Kluger
Audi A4
Mercedes-Benz M-Class
Sales
15,423
7,273
6,749
6,658
5,065
4,943
3,105
2,731
2,652
2,589
CORPORATE SPECIFIC MASS TARGET
480
Ferrari
430
Lamborghini
380
Bentley
Aston Martin
Rolls Royce
Maybach
CO2 grams/km
Maserati
330
280
Holden
Jaguar
230
Lotus
180
130
Toyota
BMW
Mazda Audi
Renault
Kia
VW
Honda
Suzuki
Hyundai
Citroen
Proton
Skoda Mini
Fiat
Alfa
Land Rover
Porsche
Chrysler Jeep
Ford
Nissan
Lexus Dodge
Subaru
Mitsubishi
Mercedes
SSangyong
Isuzu
Peugeot
Smart
80
800
1300
1800
2300
Mass Kgs
2800
3300
CO2 STANDARD : SUMMARY
1. Developed Co-operatively with Industry.
2. Based on reliable data.
3. Recognition of Non-test cycle
technologies:
•
Alternative Fuels.
•
GSI, TPM, Air-con gases, Etc.
•
Incentives for emerging technologies.
4. Realistic target consistent with economy
wide objectives.
FEDERAL CHAMBER OF
AUTOMOTIVE INDUSTRIES
Global Fuel Economy Initiative
2 March 2011