Let the car makers stall

Andrew Simms is nef‘s Policy Director and head of nef’s Climate Change programme.

Should the car industry be bailed out alongside the banks? After all, compared to the engineers of exotic financial instruments, at least they make something real. There is opposition voiced across the political spectrum. On the ideological right there is opposition to the very notion of public support to industry, and many environmentalists argue that the time has come to shift away from the private car to more efficient mass transit.

But has German chancellor, Angela Merkel, found the answer? This week she pledged a €50bn (£44bn) package of subsidies to Germany’s car industry that will be tied to producing low-emission vehicles. On one hand it fits a model of using the opportunity of the recession to regear the economy along environmental lines. And it’s a big issue in a country in which the car industry is still one of the most significant employers. But, it’s also problematic for a nation addicted to speed limit-free autobahns and big-engined luxury cars.

There are other reasons for healthy scepticism. If they get the money, will the promises be kept? German car makers have been among the most vocal in resisting new environmental vehicle standards. The European motor industry as a whole has a bad track record. A decade-long target for reducing average vehicle greenhouse gas emissions, set in 1998, was missed by 38% (and more so in the UK).

Whether or not you believe the industry’s promises to behave better, there’s another, bigger problem that improving the fuel efficiency of individual vehicles doesn’t address. The overall pollution from a massively growing global vehicle fleet is ballooning. Where climate change is concerned, it’s not about miles per gallon, it’s about the total number of gallons. The gradual substitution of slightly less polluting cars in a few markets barely touches the huge and growing consumption of fuel by the world’s vehicles. This is even more important now that the bubble of the green claims for biofuels has been burst.

In 1950 there were an estimated 70m cars, trucks and buses on the world’s roads. Towards the end of the century there was between 600m and 700m. By 2025 the figure is expected to pass one billion.

When Dr Rajendra Pachauri, the Indian head of the Intergovernmental Panel on Climate Change, heard about the India car maker Tata’s new Nano – the world’s cheapest – he said that it was giving him nightmares. ”This is not the transport option for the country of a billion people,” he said, “many of whom cannot afford to buy even a bus ticket.”

In spite of the Nano, the distribution of vehicle ownership will also continue to be highly unequal around the world. Even by the year 2050 with the expected huge growth of car ownership in the majority world, rich countries with only 16% of the world’s population will still account for 60% of global motor vehicle emissions. Our use of, and dependence on, the private motor car remains the badge of membership of the ecological debtors club.

There are also other reasons to resist the temptation to provide a pale green life support line to the car industry, when the option exists of converting it to manufacture more benign and socially useful transport systems – a kind of “Fords into ploughshares”.

Road traffic accidents are predicted by the WHO to rise from 9th place in the rank of global leading causes of death in 2004, to 5th place by 2030. The four causes higher in the ranking are a mixture of respiratory and circulatory conditions, also linked to the pollution and sedentary lifestyles associated with car culture. If the number of deaths and injuries linked to road traffic were the result of a new disease it would be seen as a terrifying new epidemic. Governments around the world would respond with public information campaigns and the best scientists would be given huge budgets and put to work to solve the problem.

The car isn’t going away, but it is not the future of transport in a world balancing on the edge of catastrophic climate change and about to experience the peak and decline of global oil production.

The industry shouldn’t rely on subsidies to go green, it should do that anyway as it has always promised to. What investment is needed for is to jump-start the conversion of yesterday’s industries into being the agents of transition for the efficient, convivial mass transit systems we will imminently need.

Cross-posted at Comment is Free.

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