Carmakers mull over diesel's demise at Geneva auto show

Geneva auto show
Geneva auto show Copyright Reuters
By Tokunbo SalakoJeremy Wilks with Reuters
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Diesel cars sales are declining in Europe but automakers are divided over plans to meet looming EU environmental targets

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The accelerating demise of diesel, long used by carmakers to boost fuel-efficiency, is undermining their plans to meet looming European Union CO2 goals, and avoid big annual fines.

That is just one issue executives gathered at the Geneva auto show are grappling with.  They are faced with unpalatable choices: re-engineer existing vehicles at huge expense, restrict sales of some profitable models; or risk hundreds of millions of euros in penalties.

Euronews correspondant Jeremy Wilks said: "Around 180 manufacturers are at the Geneva International Motor show, along with 10,000 accredited journalists. Some 90 new vehicles will be unveiled, many of them have electric or petrol-electric hybrid power plants, but there is still a cloud of diesel hanging over the entire car sector, however, Toyota has decided it is going to stop selling diesel cars in Europe from now on."

It is a major but unsurprising move from the Japanese firm, as the world's largest car maker has been at the forefront of hybrid technology for years. Environmental concerns over diesel has seen its popularity plummet.

Toyota unveils its hybrid strategy

Matthew Harrison, Vice President of Toyota Europe explained the thinking behind the decision: "What happened in the last 12-18 months is we are seeing pressure on diesels, we are seeing the cost of transacting on diesels escalate and hybrids are going the opposite direction. And therefore for us hybrid is a more profitable place to be than the diesel sector right now."

Diesel dilemma

Europe's biggest car maker, Volkswagen, is not ready yet to change course completely as it believes diesel cars still have a large role to play on our roads.

Matthias Mueller, VW's chief executive told euronews: "I'm firmly convinced that diesel will experience a revival.  We will rely on it for perhaps the next 10-15 years on a co-existence of combustion engines and electric cars."

But as more drivers shun diesels, more carmakers are on track to miss tougher EU carbon dioxide goals

taking effect in 2020.

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