A new study suggests that diesel-powered vehicles could fall 40 percentage points to represent just 5% of the European car market by 2030.
Between 2015 and 2017, diesel-powered vehicles fell from a 52% to a 45% share of the European car market, due in part to external factors such as Volkswagen’s emissions scandal, and concerns around the emissions of particulate matter caused by diesel vehicles – despite the fact that carbon dioxide emissions from diesel cars are lower, on average.
Now, a new report by AlixPartners estimates that diesel-powered vehicles could fall to only 5% of the European vehicles market by 2030, according to the BBC. The consulting firm warns that this could have negative effect on the bloc’s ability to meet the ambitious carbon dioxide reduction targets to which it committed as part of its signature of the Paris Climate Agreement.
What other challenges is the automotive industry facing?
Another major concern is the rapid growth of electric and autonomous vehicles, both of which carry their own set of unique challenges. Some USD $61bn (~€52.3bn) is being invested in the development of the technologies initially powering autonomous vehicles, but in a survey conducted by AlixPartners, customers indicated that they would be willing to pay just $2,300 per vehicle for autonomy, ten times less than current systems cost.
Further, more than 200 electric vehicle models are being developed worldwide, with more than $255bn being invested, meaning that many of these models are likely to lose money. According to John Hoffecker, global vice chairman of AlixPartners, this poses one of the largest potential shake-ups of the global automotive industry in years.
He explained: “A pile-up of epic proportions awaits this industry as hundreds of players are spending hundreds of billions of dollars on electric and autonomous technologies as they rush to stake a claim on the biggest change to hit this industry in a hundred years. The winners in this free-for-all will be those who have the right strategies and, equally important, execute on those strategies to their fullest potential—as billions will be lost by many.”