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Green regs scramble Euro auto market



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Europe’s onerous triple threat of fuel mileage rules, $3 a gallon gas taxes, and Kyoto emissions regs are making little headway on their stated goals of CO2 emissions cuts or oil independence (see my report in The Detroit News here), but they are roiling the European auto industry as my colleague Christine Tierney reports today from the Frankfurt Auto Show.

 

While automakers in general have been moving toward global alliances to pool the costs of environmental regulation, two major industry developments this year were direct consequences of green Eurocrats’meddling.

 

In a move that shocked Detroit, Daimler dumped its Chrysler division. Why? “The high cost of developing fuel-efficient technology (to meet European Commission GW diktats) for big luxury cars was among the factors that led Daimler to sell Chrysler and focus on (its) premium car business,” reports Tierney.

 

Even more interesting is Porsche’s plight.

 

The company has been making record profits thanks to its hugely popular venture into SUVs (the Porsche Cayenne). But making green conflicts with being green. The Cayenne has seriously skewed Porsche’s emissions numbers, putting the company well out of reach of EC goals. So Porsche is putting its profits into the acquiring 51 percent of much larger VW,  because, reports Tierney, “a majority holding would allow it to combine its model range with VW for average emission calculations.”

 

So . . . Europe puts enormous burdens on its industry to meet green goals that are unattainable. And this is the model Washington wants to follow?



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