LeasePlan CEO: Germany’s clean mobility commission should harness the EV future
Tex Gunning, CEO of LeasePlan, and Nigel Topping, CEO of the We Mean Business coalition
Climate change is one of the biggest threats we face as a society and the need to address it is becoming more urgent everyday.
The transport sector represents a major challenge in addressing that threat, but also one of the biggest opportunities.
The sector currently accounts for 23% of global energy-related CO2 emissions and is the fastest-growing contributor to climate change, according to the IEA. In Germany, the home country of the Energiewende, the transport sector is the only sector where no GHG emission reductions have been achieved since 1990. Clearly more work needs to be done.
However, one of the key solutions to these problems has finally come of age and is ready to accelerate the transition to the zero-carbon transport future – the electric vehicle (EV).
Thanks to a wave of technological advances, EVs are now increasingly cost competitive and can achieve ranges that rival many traditional cars. As LeasePlan’s 2019 EV Readiness Index shows, driving an EV is now a truly viable option in an increasing number of European countries.
By embracing this new technology and committing to switch away from polluting diesel and petrol cars, governments and businesses can help to tackle pollution and achieve the goals of the Paris Agreement.
Direction of travel is electric
As the German government are currently discussing the future of mobility, they have a clear opportunity to embrace EVs, to help drive economic growth and tackle climate issues.
The countries and businesses that get ahead of the curve by embracing the transition to EVs will both help tackle climate change and harness the economic and business benefits of the growing market, including job creation.
Volkswagen’s recent decision to accelerate its shift to EVs, targeting the launch of 70 fully electric models by 2028, is further evidence that the world’s largest auto-makers are gearing up for the electric future.
That evidence was clearly seen at the Geneva Motor Show earlier this month, where there were dozens of new EVs on show, from the likes of VW, Honda and Citroen. While VW’s Audi were so confident of the direction of travel, that the German luxury automaker decided to only show EVs at the event.
To date, virtually all of the world’s major automakers have committed to electrify part or all of their fleet, with hundreds of new electric models planned for production overall.
Ahead of the Geneva Motor Show, this message was also made by the German Automotive Industry, with its plans to invest nearly €60 billion ($68 billion) on EVs and driverless technologies over the next three years.
One of the key reasons automakers are committing to EVs is growing demand. Currently the US is outpacing Europe on this front partly thanks to the success of Tesla in popularising EVs – the Tesla Model 3 became the best-selling US car by revenue last year. That’s a trend the German auto industry should take careful note of when deciding which models will help them retain their world-leading status.
The EU is lagging behind with EVs reaching just a 2% share for the first time in 2018, according to figures from the environmental consultancy Transport and Environment, firmly behind the US at 4%.
Though the share of EVs remains low in many countries, sales show every sign of being at the start of an exponential growth curve that will lead to the dominance of the market in the coming decades. For example, Chinese plug-in electric vehicle (PEV) sales jumped 175% in February 2019 year-on-year to grab a share of 4.8% in the world’s biggest auto market.
Meanwhile, over 35 companies including LeasePlan are working to drive the shift to more sustainable powertrains and demonstrating demand for EVs through EV100 – a global business initiative designed to fast-track the uptake of electric vehicles and infrastructure among large global corporations, launched by The Climate Group.
Policy makers are stepping up
Globally, the policy landscape is increasingly shifting towards the rapid rollout of EVs as a vital tool for reducing urban pollution and achieving the goals of the Paris Agreement.
Several countries have already embraced EVs as a core solution to these problems, as well as a key driver of growth. The UK, France and Norway have all committed to phasing out gas and diesel powered light passenger vehicles completely in the coming decades. While China has increasing sales quotas for EVs – starting at 10% for 2019.
While signals like these give business the clarity and confidence to invest, more needs to be done. The current work of the clean mobility commission in Germany is a major opportunity to give business a clear sign that it’s time to invest in the electric vehicle future. While the working group meeting on Monday did not yet bring the desired breakthrough, we encourage the members of the commission and the German government to follow the example of other countries and forerunners of the automotive industry and to make bold commitments to harness the e-mobility future.
This article originally appeared in Tagesspiegel (German language)