Friday 30 September 2016

VW emissions scandal could force Renault to phase out diesel engines

The cost of meeting stricter emissions rules may force maker to stop producing diesel range

Published 11/09/2016 | 02:30

END OF THE AFFAIR: There are health concerns over diesel
END OF THE AFFAIR: There are health concerns over diesel

Renault, the French car maker, expects diesel engines to gradually disappear from most of its European cars, according to the news agency Reuters.

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There has been no official announcement to this effect from the company, but the move is believed to be a response to the implications of the Volkswagen emissions scandal.

Almost a year to the date since VW admitted engineering software to cheat US diesel emissions tests, more stringent EU standards, due in 2020, are forcing major European car-makers to revise their strategic plans.

Earlier this year, Renault's head office was raided by French government officials as a part of a probe, into vehicle emissions, investigating claims that these actually were higher than the legal limits.

Europe is a major market for diesel cars and many companies have heavily invested in them despite plans for much stricter EU emissions standards.

The Reuters report says that at a recent internal company meeting Renault's Chief Competitiveness Officer, Thierry Bollore, was reported to have expressed doubt that diesel would survive as a viable part of their small/medium passenger car offering due to tougher standards and testing methods that will increase the overall technology costs.

Renault no longer offers a diesel engine on its A Segment models such as the Twingo, and it could potentially stop producing diesel engines for their B and C segment models such as the Clio or Megane by 2020. The A, B and C segments accounted for a large slice of the group's 1.6 million cars sold last year and more than 60pc of them were diesels.

Commenting on the Reuters report, Renault Ireland spokesman said: "There is nothing new, Renault has always said that it will adapt its offer according to the local market demand."

But it is not just concerns about the financial feasibility of producing cleaner engines that point to a bleak future for diesel - the large number of diesel cars on urban roads gives rise to health concerns from the gases they produce including NOX (nitric oxide and nitrogen dioxide), sulphur oxide and particle matter emissions.

The World Health Organisation estimates that traffic-generated air pollution causes seven million premature deaths annually as well as impacting negatively on the lives of many more. To tackle this serious health risk, a number of cities including London, Paris and several German cities, are moving to restrict or even ban diesel-engine vehicles from within their boundaries.

In many European countries, the proliferation of diesel-powered cars has been encouraged by environmentally inspired tax incentives to tackle CO2 emissions.

In Ireland, diesel has been the fuel of choice for most drivers over the past number of years. Sold on the environmental benefits of low levels of CO2 as well as the consequent improvement in fuel economy, such is their appeal that they now make up more than 75pc of cars on our roads.

According to the Central Statistics Office, 70pc of the 119,952 new cars taxed between January and July had diesel engines. But our love affair with diesel didn't start by chance. The current situation is the result of changes made to the motor tax system that was intended to lower carbon emissions by pushing people towards diesel.

In 2008, the Fianna Fail-Green Party coalition changed the VRT and motor tax system from one based on engine capacity to the current one based on CO2 emissions. As a result of this change and improvements in the performance of diesel cars, sales dramatically shifted in favour of diesel, and the percentage of new petrol cars fell from 70pc in 2007 to 32pc by the end of 2009.

Given the immediate health concerns of diesel emissions, the decision to prioritise reduced carbon emissions by incentivising diesel would seem to be a misguided one.

The Government is now considering increasing the excise duty charged on diesel in the Budget next month to be equal to the rate applied on petrol. Currently the excise duty paid on petrol is 22pc (11 cent) higher than diesel.

The plan, if implemented, would see the price of a litre of diesel brought into line with the price of a litre of petrol over a five-year period. The UK has already has equalised excise rates on petrol and diesel and a number of countries, notably France and Belgium, have also moved to equalise the excise rate.

Meanwhile in Ireland, a recent sitting of Castlebar District Court represented the latest instalment of the "dieselgate" saga where Roscommon nurse Eithne Higgins is suing VW Ireland for losses claimed in relation to her 2010 Seat Leon as a result of the scandal.

The car company's legal team walked out last week claiming that the district court has no jurisdiction to hear the case; however, proceedings continued without them.

Sunday Independent

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