2

The Global Automotive Industry

Climate Change and CO2

Fuel Quality and Emissions

3

Transport CO2 emissions compared to TOTAL man made emissions

Road transport share of global CO2 emissions:

LESS THAN 16%

COST EFFICIENCY IS CRUCIAL !

Road Transport (Cars, Trucks & Buses)

Electricity Generation & Heating

Manufacturing & Construction

Fuel combustion for other uses

15.9%

43.9%

18.2%12.2%

4

CO2 emissions - EU-15 Sales weighted average – new passenger cars

Source: EU Commission communication – SEC(2006)1078

7.2 l/100km

-12.4 % since 19958 l/100km

6.7 l/100km

5.8 l/100km

130

140

150

160

170

180

190

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

gra

mm

es

/km

Petrol

Diesel

All fuels

5

Research and Development

85 billion €/year in R&D

>1000 000 cars/year in EU with <120 g/km CO2

Development of sophisticated technologies

New propulsion technologies / alternative fuels

Affordability

Time to bring to the market

Time to replace existing fleets

6

The Integrated Approach to reduce Road Transport CO2

Vehicle technology and its penetration

Fuel infrastructure

Improved traffic management

Final consumer – ECO driving

Government policies:

Clear Coherent

Predictable Stable

7

Fuel Quality

Vehicle and fuel: one complete integrated

system

Clean vehicles need clean fuels

UN ECE activities starting to define link

emissions/vehicle/fuel

Strong support by auto industry

8

Xavier Fels

President CCFA (French Automotive Manufacturers Association)

Vice-President OICA

Geneva Motor Show5 March 2008

Reducing CO2 emissions

The situation in Europe

9

The “engine” of Europe

18.6 million vehicles produced per year, 1/3 of global production

2.3 million direct jobs, indirect employment for another 10 million families

€ 20 billion in R&D spending, largest private investor

€ 41.6 billion of net trade contribution€ 360 billion of tax revenues

10

The automotive industry is committed

Automotive industry is strongly involved and committed

• 13% reduction CO2 emissions through vehicle performance only (1995-2005)

• Car industry is building on significant technological investments and progress to date

• All manufacturers are making considerable efforts:

Need for global, consistent and cost-effective action.

Engine and transmission Light weight materials

Improved aerodynamics Alternative fuel technologies

Friction reduction Hybrid, plug-in

… and many more

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EU Commission only focus on car technology

December 19, 2007 : European Commission’s legislative proposal on CO2 reduction from cars :

• 120g/km in 2012:– 130g/km through technologies (e.g. engine)– 5g/km through bio fuels – 5g/km through complementary vehicle technology measures

(Gear shift indicator, Energy-efficient air-conditioning, Low rolling resistance tyres, Tyre pressure monitoring systems,…)

• Narrow focus only on new car technology instead of an integrated approach involving all relevant stakeholders

– Contrary to holistic approach adopted in Commission’s Energy Efficiency Action Plan

– Contrary to better regulation principles

12

Reducing CO2 emissions – – integrated approach

An integrated approach

Delivering majority of new car CO2 reductions

Sustainable production

Reducing congestion

Influencing demand in a harmonised way

13

Unrealistic lead time (1)

• 2012 for reaching 130g/km for new car fleet is unrealistic:

• Typical product cycle for a car is ~6-7 years; development phase is ~5 years from concept definition until start of production

• Of new cars sold in 2012…• Nearly 2/3 are already in execution or production

phase• The remaining 1/3 are already in concept phase

14

Unrealistic lead time (2)

0%

20%

40%

60%

80%

100%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Car sales volumes by introduction year (in %)

Models in advanced engineeringphase in mid-07

Models in concept phase in mid-07

Models in execution or productionphase in mid-07

15

The European auto industry needs:

Engagement of the consumers through a CO2 oriented labelling and tax policy

Fair and cost-effective rules it can comply with, in particular:

• Level of compensation payments that should be no higher than for other sectors (the proposed level of penalty is equivalent to €475 per ton while the current CO2 price on the market is €5 per ton !)

Better reward and encouragement for “eco innovations” such as:

• Energy-saving car lights, tools to personalise engine and transmission management, tailored on-board computers and navigation systems…

16

Thank you

The European auto industry needs to maintain diversity and affordability of cars to customers.

17

How the United States

Is Meeting the CO2

Challenge

PRESENTATION BY

Dave McCurdyPresident & CEO

Alliance of Automobile Manufacturers

March 5, 2008

1818

Higher MPG, Lower CO2

The historic 2007 U.S. Energy Bill will produce dramatic results by 2020:

Raises mileage standards to 35 MPG, a 40% increase;

Reduces carbon dioxide (CO2) from autos by 30%;

Avoids 206 million metric tons of greenhouse gases annually;

Lowers oil consumption by 1.1 million barrels a day;

Saves 18 billion gallons of gasoline per year; and

Requires 36 billion gallons of renewable fuels annually.

18

1919

Automakers Represent the First Industry to Make Dramatic CO2 Reductions

America needs a more CO2-efficient society,

and a new fleet of CO2-efficient autos will be

dominating the marketplace.d produce less

CO2.

By reducing CO2 by 30%, automakers will

lead all industries in setting a clear path to

meeting the recent United Nations Bali

Climate Change Summit’s goal of a 50%

reduction in CO2 emissions by 2050.

19

20

A Multi-Sector Approach to Climate Change

EFFECTIVE POLICY NEEDS TO:

Foster more alternative fuel choices, especially more low-carbon, renewable fuels;

Implement an aggressive program to enhance America’s fuels infrastructure, so our advanced technology autos have the fuels needed to power them;

Empower the research and development community to move us closer to technology breakthroughs like batteries for plug-in hybrids and fuel cells;

Encourage the U.S. investment community to stimulate economic investments in our future fuels and technologies;

Involve all levels of government.

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Consumers

Policy should

encourage

consumers to

conserve fuel and

to consider

purchasing one of

the many fuel-

efficient autos on

sale today.

21

An effective climate change

policy must be built upon a

multi-sector approach that

involves all stakeholders.

A Multi-Sector Approach

to Climate Change

21

UTILITIES & MANUFACTURING

CONSUMERS

FUEL PROVIDERS AIRPLANES LOW-CARBON FUELS

AUTOS BOATS TRAINS

Japan Automobile Manufacturers Association, Inc.

22

Japan’s Approachto CO2 Reduction

Yoshiyasu Nao

President

Japan Automobile Manufacturers Association, Inc.

5 March 2008

　

Japan Automobile Manufacturers Association, Inc.

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CO2 emissions in Japan’s transport sector are decreasing.CO2 emissions in Japan’s transport sector are decreasing.

In line with the Kyoto Protocol, the Japanese government formulated a target achievement plan which established CO2 reduction targets for all major sectors including the transport sector.

Since peaking in 2001, CO2 emissions in Japan’s transport sector have been on a downward trend, dropping to 254 million tons in 2006. Through greater automotive fuel efficiency, improved traffic flow, the wider use of alternative-energy vehicles and other measures including the adoption of eco-driving practices, the transport sector’s target for 2010 is achievable.

CO2 Emission Volumes in Japan’s Transport Sector

million

tons

Other: 5.6

Improved traffic flow:28.3

Greaterfuelefficiency21.0

Source: Ministry of Environment data

An estimated 54.9 million tons of CO2 will not be emitted (through greater fuel efficiency: 21 million tons; through improved traffic flow: 28.3 million tons; through wider use of alternative-energy vehicles and other measures : 5.6 million tons) in order to meet Japan’s Kyoto Protocol-related transport-sector target.

2010Source: JAMA

Japan Automobile Manufacturers Association, Inc.

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Achieving Greater Fuel Efficiency Achieving Greater Fuel Efficiency ★The average fuel efficiency of new cars sold in Japan is increasing every year, making a significant contribution to CO2

reduction.★Japan’s 2010 fuel efficiency standard for passenger cars has already been met (and in fact exceeded), as a result of

intensive efforts and considerable financial investment by Japan’s automakers.★Reducing CO2 emissions in the transport sector by 21 million tons through greater fuel efficiency, as per Japan’s Kyoto

Protocol Target Achievement Plan, is achievable.★JAMA member companies are now working hard towards compliance with Japan’s very stringent 2015 fuel efficiency

standard for passenger cars.

Trend in the Average Fuel-Efficiency Performance of Gasoline-Powered Passenger Cars

2015 fuel efficiency target

Despite the achievements in fuel efficiency performance to date, meeting the 2015 target remains a major challenge.

Average fuel efficiency for new cars sold in Japan reached 16.0 km/l in 2006, exceeding the 2010 target of 15.1 km/l.

Ave

rag

e f

ue

l eff

icie

ncy

p

erf

orm

an

ce(n

ew

ve

hic

les)

Japan Automobile Manufacturers Association, Inc.

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Improving Traffic Flow Improving Traffic Flow

Improved traffic flow is achieved through:

　○ Improvements to road infrastructure

　○ Greater efficiency in goods distribution

　○ Wider application of ITS

　○ Use of advanced signal-control systems 　

Etc.

Improved traffic flow contributes to CO2 reduction by enabling increased vehicle speed, which in turn contributes to greater automotive fuel efficiency.

Source: Japan Automobile Research Institute data

CO2 emissions

CO

2 e

mis

sio

n le

vels

Japan Automobile Manufacturers Association, Inc.

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Adopting an Integrated Sectoral Approachto CO2 Reduction

Adopting an Integrated Sectoral Approachto CO2 Reduction

GreaterGreaterFuel EfficiencyFuel Efficiency

Improved Improved Traffic FlowTraffic Flow

More More Efficient Efficient Use ofUse ofMotor Motor

VehiclesVehicles

Supply of Supply of Alternative Alternative

FuelsFuels

Improving automotive fuel efficiency and traffic flow is not enough to reduce CO2 emissions in the road transport sector. An integrated approach is required, which includes the development and supply of alternative fuels and a more efficient use of vehicles. The adoption of these measures will ultimately make CO2 reduction efforts compatible with economic growth.All stakeholders concerned should identify their individual responsibilities and make their best efforts to carry them out, in a framework of mutual cooperation.

Automakers/Government[fuel efficiency

standards]

Government[road infrastructure upgrades, ITS, enforce- ment of parking bans, etc.]

Government/Fuel suppliers/

Automakers[biofuels, etc.]

Vehicle users(with the cooperation of

fleet operators & government promotion)

[eco-driving, vehicle sharing, more efficient goods distribution, shift to rail transport, etc.]

Japan Automobile Manufacturers Association, Inc.

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Summary Summary

★CO2 reductions in the transport sector can be achieved through

comprehensive measures including greater automotive fuel efficiency

(through improved vehicle technologies), improved traffic flow

(through road infrastructure improvements including better traffic

management), and the more efficient use of vehicles.

★Under Japan’s Kyoto Protocol Target Achievement Plan, an

integrated, sectoral approach to reducing road transport CO2

emissions is steadily proving successful.

★The sectoral approach can be adopted globally on a country-by-country basis. JAMA hopes that many countries will decide to adopt this approach and take action accordingly, so that CO2 reductions can be achieved worldwide.

Japan Automobile Manufacturers Association, Inc.

28

　　　

Thank you!

Read our annual environment report

@www.jama-english.jp

Overview of Current Fuel consumption targets in EU, US and Japan

Corporate Average Fuel Economy (Uniform Target)

Present target: 27,5 mpg = ~ 204 gCO2/km (US Cycle)

Penalties: 5,5 $ per 0,1 mpg = ~ 5 € per gCO2/km x vol. cars

Future Target: 35 mpg by 2020 = ~ 160 gCO2/km (US Cycle)

Parametric approach: Weight (segmentation)

Future Target: 16.8 km/l by 2015 = 138 g CO2/km (Japan Cycle)

Penalties: ~ 6.000 €/manufacturer

Integrated Approach: Approximately 50% CO2 reduction by infrastructure

Parametric approach: Weight (segmentation)

Target: 120 gCO2/km by 2012

(130 g through Vehicle Technology - 10 g through Complementary measures & biofuels)

Penalties: 2012 / 2013 / 2014 / 2015 20 / 35 / 60 / 95 € / g CO2/km x vol. cars

Integrated Approach : 5 gr CO2 reduction by biofuels –

NO reduction by Infrastructure

Commission proposal - under discussion

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