Carmakers need extra help to cut down on carbon emissions

By Bill Parfitt
Last Updated: 2:05am BST 22/07/2008

Britain's carmakers, which assemble 1.7m vehicles a year and employ 800,000 people, will this week commit themselves to cutting oil dependence and reducing CO2 emissions as senior executives from the global motor industry converge on London for its biannual motor show.
Few outsiders think the motor industry is leading the way in developing and bringing to market technologies to cut emissions dramatically. But the array of low-emission vehicles on show in London - featured in the first "green pavilion" - reflects heavy investment in clean technology, even at a time of unprecedented industry turmoil.
That turmoil has been characterised by rising oil prices, fragile consumer confidence, general price erosion, rising raw material costs and regulatory uncertainty.

Last week, GM reacted to the market upheaval with a plan to bolster liquidity by $15bn (£7.5bn) next year, enabling the company to continue investing in a competitive product line-up. Already, that investment has enabled GM to adopt low-carbon technologies, including biofuels - an energy source that has attracted controversy in the UK.
The controversy intensified earlier this month, when the UK government's biofuel review by Professor Ed Gallagher, chairman of the Renewable Fuels Agency, called for a slowdown in biofuel development amid fears of an adverse impact on food prices and climate change.
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GM and other carmakers are conscious of these concerns. But we believe biofuels should be embraced as one of the key strategies to meet continued global demand for cars, given that E85 - a common biofuel - can reduce CO2 emissions by up to 85pc on a "well to wheels" basis.
Biofuels will be one of the alternative sources of energy for new cars, alongside electricity and hydrogen, as the industry serves fast-growing new markets and existing ones with cleaner vehicles.
The development of such vehicles is particularly urgent given current oil prices and the rising cost of processing remaining stocks. That cost includes the potentially serious impact on the environment from continued hydrocarbon extraction, production and utilisation.
The need for alternative fuels and vehicles capable of running on them will become even more pressing as other macro-economic issues and geopolitical tensions affect oil's availability and price.
One solution to the concerns about alternatives such as biofuels, which the auto industry could endorse, is sustainability certification of all fuels, to give consumers better information to make more informed choices about the vehicles and fuels they use.
Such measures would complement the development of ultra-low emission vehicles. Even so, many of these cars will not be in showrooms overnight. So the entire industry must adopt a phased approach to cleaner technologies.
Frankly, there is no magic silver bullet to reduce CO2 from cars. Any workable strategy needs to take advantage of all available technologies, many in combination with one another.
Hence at GM, our strategy has short, medium and long-term objectives. Short-term, we aim to squeeze even more efficiency out of conventional petrol and diesel engines. Beyond that, we are rolling out many more vehicles using renewable alternative fuels such as bioethanol and biogas. In the medium term, we are focusing on extended-range electric vehicles, while our long-term focus remains hydrogen fuel-cell vehicles emitting only water vapour.
Some of those vehicles will be on show in London, including a Saab Biohybrid concept and an extended-range Vauxhall Flextreme plug-in electric vehicle.
But the car industry cannot make this journey alone. Consumers have a role to play in deciding what car to purchase and by using them responsibly. Fuel suppliers must do more to make lower-carbon fuels available. And given congestion on our roads, infrastructure providers need to focus on improving the road system.
Vitally, governments need to send the right policy signals, with a workable tax framework and regulatory models that give manufacturers credit for investing in cutting-edge, very low-carbon technologies. That requires an integrated policy framework sending complementary signals to automakers, fuel companies, infrastructure providers and consumers to reduce CO2 emissions.
To achieve the economies of scale necessary to make these technologies affordable, these policy signals need to be harmonised as much as possible across the entire EU to take advantage of a single, internal market of more than 15m vehicles annually.
This message will be reinforced at the British International Motor Show, where more low-emission vehicles will be on display than ever before. By doing so, the industry is demonstrating its determination to do its part to cut CO2. We will continue to do so. But it is time other stakeholders showed a similar, workable, commitment.
Bill Parfitt is chairman and managing director of General Motors in the UK and Ireland