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EU Emissions Regulations Expected to Drive Rise in Green Vehicles

July 09, 2010

LONDON - The share of 'green' vehicles on European roads will increase from 2.3 percent in 2009 to 3.2 percent in 2015, Datamonitor Group has predicted in a new report, the Green Fleet Report 2010.

The independent business analyst expects EU emission norms and government regulations to be the main driving force behind this growth in fuel-efficient, low-carbon-emission vehicles.

According to Datamonitor estimates, business fleet vehicles account for around 10 percent of all cars on EU roads. As a result of the financial crisis, the green consumer mindset, and increasing governmental pressure, lessors are looking to incorporate more fuel-efficient vehicles into their fleets a trend which is set to increase in the next few years.

"As a result of a growing awareness among consumers and companies, the penetration of environmentally friendly cars in the European fleet sector has increased over the past few years," said Tarun Bisht, senior automotive analyst at Datamonitor.

"A 'carrot and stick' approach by governments through legislative incentives such as tax breaks, congestion charges and greater tax on polluting vehicles has led fleet lessors and leasing companies to rethink their 'green' car strategies. As a result, demand for cars that emit less than 120g of carbon dioxide per kilometer grew at a compound annual growth rate of around 40% between 2000 and 2009 in Europe.

"By ensuring that low-carbon-emission cars dominate their fleet parc, lessors are ensuring that the company and user fuel bills are reduced. The greater availability of fuel-efficient cars on the market has also contributed to the uptake in green car penetration among company fleets.

"Meanwhile, leasing companies see the 'green' tag as a positive driver for their (and their clients') brand image," Bisht said.

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