Tata Motors faces challenge with Jaguar-Land Rover cars’ emissions woes

By 2012, Jaguar and Land Rover must start making cars that are lighter and less polluting. It’s going to be a big challenge for new owner Tata Motors

Jaguar and Land Rover’s new owner, Tata Motors may end up getting into a bind over the penalties faced by cars whose average carbon dioxide (CO2) emissions are significantly higher than the proposed European Commission (EC) norms, which will come into effect from 2012.

While JLR is working towards an overall reduction in its cars’ emissions over the next 2 – 3 years, heavy investments would be needed to develop biofuel, hybrid and other ‘green technologies,’ without which it may be impossible for carmakers to do business in Europe.

In an initiative aimed at reducing CO2 emissions from new cars by 19%, the EC had adopted a proposal for legislation in December last year. The proposal was aimed at reducing greenhouse gas emissions and meet Kyoto Protocol targets. The aim is to reduce average CO2 emissions from new cars in Europe from around 160gm/km to 130gm/km by 2012.

While JLR could have offset higher CO2 emission of its fleet by balancing it with earlier owner Ford’s fleet of lighter, lower emission cars, the same would not be possible for Tata Motors as it does not sell cars in Europe.

If Tata Motors can’t find a way to make JLR cars significantly lighter and less polluting by 2012, the company will face a proposed penalty (the ‘excess emissions premium’) for going over the stipulated emissions norms. A premium of 20 euros per gm/km has been proposed in 2012, rising to 35 euros in 2013, 60 euros in 2014 and 95 euros by 2015.

It’s a huge challenge for Jaguar and Land Rover, but Tata Motors spokespersons say the company had always been aware of the issue and is working towards finding various solutions.

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