Stricter EU truck rules will drive investment in combustion engine, warns Volvo

Stricter EU truck rules will drive investment in combustion engine, warns Volvo

EURACTIV — 2023-03-17

Land transportation

EU rules setting stricter pollution standards for trucks will pull resources from the production of zero-emission vehicles, slowing the shift to electrification, the vice president of Volvo group has said.

Lars Stenqvist, chief technology officer with Volvo group, the heavy-duty vehicle wing of the famed Swedish manufacturer, told EURACTIV that the new Euro 7 rules, tabled by the European Commission in 2022 November, would require the company to invest in re-engineering the combustion engine.

The big risk right now is that if we get a very strict Euro 7 legislation, maybe I will need to move my engineers back to combustion engine development in order to fulfil the tough regulation [requirements],” Stenqvist said.

I would need to move them away from fuel cell electric vehicle development, move them away from battery electric vehicle development, and that means that we are slowing down the transformation to zero-emission vehicles,” he added.

The proposed Euro 7 regulation tightens emission limits for pollutants such as carbon monoxide, NOx, and particulate matter for heavy-duty vehicles.

Industry has generally reacted negatively to the proposal, arguing that the focus should be on ramping up production of electric and hydrogen vehicles, rather than making dwindling numbers of combustion engine vehicles cleaner.

Stenqvist questioned why the Euro 7 proposal was not more closely aligned with the Commission’s recent draft law setting out CO2 emission standards for heavy-duty vehicles.

The proposed CO2 standards would require a 90% reduction in carbon emissions from new heavy-duty vehicles sold from 2040.

Unfortunately, we feel that the two sides of the commission are not really collaborating, which we would have expected,” he said.

Stenqvist pointed to the differing impact assessments for the files, highlighting that Euro 7 assumes an 11% market penetration of zero emission vehicles by 2030, while the CO2 standards proposal assumes 35% market penetration by the same date.

To us, it’s very strange that you have two proposals from the same commission on the table with two impact assessments that are coming to such different conclusions. That cannot be good for Europe to put two pieces of legislation in place that go in two different directions.

Volvo group is considered among the most progressive truck manufacturers when it comes to green technology, even dubbing themselves a “pioneer” in building battery electric trucks. However, despite their focus on new propulsion systems, Stenqvist still sees combustion engine vehicles as an important part of their offering.

We believe that for certain applications, also in the very long run, the combustion engine running on non-fossil, renewable fuels will still be the sweet spot”, he said.

Rather than diesel, these engines will run on low-carbon fuels, such as biodiesel from vegetable oils and hydrogen-derived synthetic fuels, he said.

However, due to increased competition from other transport modes, it is expected that these fuels will become more expensive, making combustion engine vehicles suitable for “applications where it is less important to keep the cost down”.

Those applications will be those that are not so extremely cost sensitive, as those fuels that will be directed to our sector will be rather expensive, because we will compete with aviation, we will compete with maritime,” Stenqvist explained.

After being delayed again and again, the Euro 7 vehicle pollution standards were released on Thursday (2023 November 10) in what will likely be the final air quality regulation for petrol and diesel cars.

Making clean vehicles competitive

Rather than Brussels imposing restrictions, Stenqvist favours EU-wide carbon pricing for road transport.

It’s very important that we understand that to speed up this transformation, we also need to be more serious on putting a price on carbon,” he said.

Having a price on carbon makes clean vehicles more attractive financially, ensuring that “zero-mission vehicles are outperforming the fossil based ones”.

According to Stanquist, the roll out of charging infrastructure across Europe must also be drastically improved, as customers are deterred by the gaps in coverage.

The challenge is not only on us to deliver [new technology], we also need the enabling conditions around it,” he said.

Despite the lack of charging points, interest in purchasing clean vehicles is “exponential”, Stanquist said, attributing this in part to a move by companies to reach net-zero.

Our customers are the transport companies, but the real demand is coming from our customers’ customers – the transport buyers,” said Stanquist.

And the reason why the transport buyers are clearly getting more and more interested in this is that so many companies today have different pledges when it comes to sustainability."

When they start to do the mathematics and the calculations around their CO2 footprint, almost all of them, rather soon, come to the conclusion that if they don’t fix logistics, then they’re smoked,” he added.

The Euro 7 proposal and the CO2 emission standards for heavy-duty vehicles will now go to the European Parliament and Council to be reviewed and amended, with a conclusion of the files expected in 2024.