Despite the hype, Europe is cool to eco-friendly cars

Dec 1, 2007, 8:31 GMT

Hamburg - Going green has so far done little to boost the sales of carmakers in Europe who are trying to win back the lead from their Asian rivals by stressing a commitment to environmental friendliness.

Eco-friendly vehicles were thronged at the Frankfurt car show earlier this year but there are no queues at local showrooms to buy them. It seems green cars are either too expensive or simply not available.

Much-vaunted new models, such as the petrol-electric hybrid version of the Porsche Cayenne or eco-offerings from volume makers like Ford and Opel, are not even on sale yet. Others such as the hybrid X6 offroader shown by BMW may never reach series production.

Meanwhile, surveys show that while frugal diesels, gas-powered cars and the hybrids, which feature either a petrol or a diesel engine mated to an auxiliary electric motor, are generating a lot of interest, German customers in particular are not prepared to pay a premium for cars which are easier on the environment.

It's a different story in Sweden, where officials have reported Europe's fastest increase in the number of new green cars registered in 2007. Sales in Sweden of low-emission vehicles such as hybrids and ethanol-powered cars went up by 25 per cent in the first six months of the year.

'Sweden is taking the lead in Europe's environmentally-friendly car league', Environment Minister Andreas Carlgren told a press conference when the figures from Swedish car industry organization Bil Sweden were presented.

Experts in Stockholm say green tax breaks for the owners of eco- friendly cars contributed significantly to the sales boost, measures which are still being discussed by the German government.

'Environmental-friendliness is something car customers expect as a matter of course, they don't want to spend more money in order to get it', said Dr August Joas, head of automotive practice at the Oliver Wyman management consultancy.

Motorists do rate the environmental impact of a car more highly than they did only a few years ago, but many are confused by the plethora of low-emission ideas on offer, Joas told Deutsche Presse- Agentur dpa.

'Consumers are just crying out for information which will help them make a decision,' said Joas. He believes an independent quality stamp detailing a car's level of eco-friendliness could help jump start sluggish sales.

A survey by the Gfk market research team showed that only 11 per cent of new car buyers in Germany would even consider buying a hybrid. Most were put off by the higher price, with three quarters saying they would be prepared to buy a greener machine provided it cost no more to purchase than a standard model.

'People have less money in their pockets these days and cars are getting more expensive, especially hybrid models', said Thomas Froeba who works for Autohaus Motor Bauer in the Bavarian town of Kronbach. Hie views are echoed by many dealers in the business.

In Germany, a hybrid model from Japanese carmakers Toyota or Honda costs an additional 2,000 to 3,000 euros (2,970 and 4,450 US dollars) over a conventional model with a petrol engine only. But supporters point to reduced fuel costs, lower tax in some countries and the higher resale values for petrol-electrics.

According to the report Hybrid Cars Market Outlook from the Indian-based market research company RNCOS, hybrid sales in Europe reached around 39,000 units in 2006 of which Toyota - whose Prius is in its tenth production year - had a 90-per-cent share. RNCOS expected European hybrid sales to top 49,500 by 2012.

Toyota said last week that demand for its Lexus brand in Europe is strong, with most of a projected boost in sales set to come from hybrid models. The firm said it was especially targeting buyers in Eastern Europe where Lexus competes head-on with premium cars from Mercedes, BMW and Audi.

Michael Ramstetter, who edits the magazine of the ADAC motoring club, recently accused German carmakers of offering motorists the 'mirage' of a green motoring future without providing the products to go with it. 'There's still not a single German-made hybrid on sale in this country', he wrote. 'Compare that to what is on offer from Japanese makers like Honda or Toyota'.

The frugal image of hybrids has meanwhile received a dent from recent tests in various German car magazines which revealed that models such as the Honda Civic and Lexus R400 can sometimes burn much more fuel than the manufacturers claim.

In an article entitled 'dispelling the hybrid myth,' Stern magazine concluded that while a petrol-hybrid could cut its owner's fuel bills in city traffic, plain diesels were much better for long- distance driving.