BERLIN — Lawmakers for the European
Union put an expiration date on the sale of new cars with combustion engines,
approving legislation last week that in effect bans vehicles powered with
diesel or gasoline from automobile showrooms beginning in 2035.
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The law, part of the EU’s ambitious plans
to make the 27-member bloc carbon neutral by 2050, is aimed at encouraging
automobile manufacturers to double down on the
production of electric vehicles.
Many automakers have already been revamping their lineups to include more
battery-powered vehicles.
Automakers will be required to cut 100
percent of carbon emissions in new cars sold in the EU by 2035, according to
the new law, making it impossible to sell new cars powered by fossil fuels.
With the passage of the law, Europe becomes
one of the largest automobile markets to mandate a focus on battery-powered
engines for cars, but not the only one. Last year, California passed similar
legislation, banning the sale of gasoline-powered cars by 2035, and New York
swiftly followed.
Proponents say the legislation will create
certainty for the auto industry by encouraging governments to invest funds
needed to develop infrastructure for battery-powered vehicles, including
expanding the charging network.
Job cutsBut critics charge that enacting a ban is
counterproductive and threatens tens of thousands of the 13 million jobs in the
EU that are linked to the automotive sector.
As if to make the point, Ford Motor
announced last Tuesday that it was cutting about 11 percent of its workforce in
Europe over the next three years, as part of its pivot to electric-vehicle
production.
European leaders advocating action on
climate change have pushed back on that argument, insisting that if the bloc is
to remain competitive in an industry that is increasingly dominated by China,
it has to pivot more quickly, and the legislation can help make that happen.
“The industrial revolution is happening
whether we like it or not,” Frans Timmermans, the EU’s top climate official,
told lawmakers Tuesday. “We can choose to lead it. Or we can leave it to other parts
of the world to lead it, and then all we can do is follow.”
The law includes limits on carbon emissions
for new cars beginning in 2030, seeking cuts based on 2021 levels, and includes
exceptions for companies that produce fewer than 1,000 vehicles. Lawmakers
stressed that the law applied only to newly produced vehicles, not to
fossil-fuel-burning cars and vans that are already on the road.
Heavy trucks and buses are also not
included in the legislation. They will, however, be subject to a different set
of rules that will scale the reduction of carbon emissions over time, but
without any outright bans on fossil fuels.
A majority of the job cuts announced by
Ford on Tuesday, 2,300 positions, will be at plants in the western German
cities of Aachen and Cologne, the company said, with another 1,300 in Britain.
Hardest hit will be workers in product development, as the company is driven by
the shift to “all-electric powertrains and reduced vehicle complexity”, it
said.
Other cuts will be in its administration,
marketing and sales divisions in Europe, it said. Ford employs some 34,000
people across Europe.
More than half of Ford’s employees in
Europe are in Germany. After the layoffs, that number is expected to shrink by
nearly one-third over the coming years, as the company reorganizes its
production to focus on electric vehicles, many of which will be manufactured in
Spain.
“The path to a sustainable profitable
future for Ford in Europe requires broad-based actions and changes in the way
we design, build and sell Ford vehicles,” said Martin Sander, the manager of
Ford’s electric-car division in Europe. “This has implications for the
capabilities and organizational structure we will need in the future.”
Last year, Ford decided to end production
of its Fiesta model by 2025 at its plant in the southwestern German city of
Saarlouis, where some 4,600 people are employed. The company chose its factory
in Valencia, Spain, over the German plant to produce two electric models that
it will sell in Europe. It is working with employee representatives and local
politicians to find a buyer for the plant and has held talks with other
automakers and energy companies in an effort to retain some of the jobs in the
region.
Ford’s futureFord is a relatively minor player in
Europe’s passenger car market, accounting for just 4 percent of new
registrations in 2021. It is the leading producer of commercial vehicles,
especially its popular vans.
In addition to manufacturing EVs at its
plant in Valencia, Ford plans to invest $2 billion in revamping its plant in
Cologne, where the first all-electric model — a five-seat, mid-size crossover
SUV, that has so far only been teased — will roll off the line later this year.
The company said Tuesday that it wanted to offer an all-electric lineup in
Europe by 2035.
Ford has been losing money as it struggles
to transform its operations to meet the growing demand for battery-powered
vehicles. On Monday the automaker announced plans to build a $3.5 billion
electric-vehicle battery factory in Michigan using technology and services from
Contemporary Amperex Technology Limited, a Chinese company known as CATL that
is the world’s largest producer of batteries for electric vehicles.
This month, Ford posted a $2.2 billion loss
in 2022 and predicted a difficult year ahead, amid chip shortages and other
supply chain issues. In Germany, the company said, its competitiveness has been
hurt by “economic and geopolitical headwinds”. Germany has struggled with
increases in the price of energy and raw materials, driven up by Russia’s war
in Ukraine.
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