The automotive industry is demanding more time to phase out combustion engines, arguing that the market situation is difficult, jobs are at risk, and a short delay in the transition would have little impact on the climate. Do you agree?

Wolfram Sparber: I agree that it would not make a big difference to the climate if we in Europe extended the deadline a little. But it does make a difference to the key question of whether we want the European automotive industry to continue to play a global role in the future?

The automotive industry is currently facing two major challenges: the transition to electric motors and the shift to increasingly digitally connected vehicles. Such a transformation may be challenging and postponing it would mean that we could continue to sell diesel and gasoline cars for a few more year however the market for them is shrinking, that much is clear. If we don't make the transformation now, we won't catch up. In 2024, approximately 2.4 million electric cars were manufactured in Europe, compared to around 12.4 million in China. We have seen it in other sectors, such as mobile communications, computers, and TV: there were European market leaders that became irrelevant, Nokia, Olivetti, the list is long. I think the goal of European policy should be to ensure that this does not happen to its automotive industry.

What is needed to achieve this?

Sparber: We can see this where the transformation has been successful. In Norway by next year, all newly registered cars will be zero-emission vehicles (in the first months of 2025, their share was consistently above 90%). This was achieved through market incentives, promotion of industry and innovation, and infrastructure development – the right framework conditions were created in a coherent and structured manner.

What about coherence in the EU countries?

Sparber: Let’s stick with market incentives for a moment: in Italy and Germany, subsidies were introduced in recent years, then abolished at short notice without any announcement of what would replace them, then, they were reintroduced in a new form or with different conditions. This does not support long-term planning and security and, in particular, does not help domestic industry, which needs a stable domestic market. There is a risk that we will create an import market.

What happened in the photovoltaic sector 15 years ago should be a lesson to the EU. PV technology was developed in Europe, the industry was built up in Europe but instead of protecting it, it was successfully exported and abandoned in Europe.

Car manufacturers argue that dependence on China is too great to meet the 2035 deadline especially when it comes to battery production.

Sparber: These same manufacturers used to laugh at battery-powered cars with considerable arrogance, saying that the quality was poor and that these cars would never be successful. They rested on their laurels on the technology they traditionally had an advantage with and refused to see the new. That was a misjudgment – and now the argument is that the Chinese are too far ahead. But the longer we wait, the more difficult it will be to catch up with China. Of course, it must also be said that in China, politicians have been systematically promoting battery manufacturers and e-mobility for 20 years, Europe has a lot of catching up to do in this area.

Another argument is inadequate charging infrastructure, which means that consumer skepticism cannot be overcome.

Sparber: European car manufacturers, with their large profits, could have easily invested in this infrastructure, especially in the early stages. Instead, Tesla, a start-up that was on the verge of bankruptcy for years, invested in it; today, the company dominates the fast and ultra-fast EV charging networks in the US and Europe. But there is no question that the infrastructure is still very uneven and needs to be expanded. The expansion of the truck charging infrastructure, which is practically non-existent, is urgently needed. In South Tyrol, we currently have only one e-charging station specifically for trucks, and the situation is not much better in other Italian regions; public truck charging coverage is still completely inadequate. An industry alliance of truck manufacturers now wants to push ahead with expansion in Europe. But we are still in the very early stages.

What about the electrification of heavy-duty transport?

Sparber: The share is still very small. Electric heavy-duty trucks accounted for only 1.5 percent of new registrations in the EU in the first half of this year, in contrast to light and medium-duty trucks, where the share was almost 20 percent. In addition to expanding the infrastructure, I believe that clear market incentive programs, such as highway tolls, are needed here. Switzerland is currently the leading European market for zero-emission trucks, and a simple formula applies there: “Zero emissions = zero costs on the highway.” This makes it economically attractive for freight carriers to accept the currently higher purchase costs, because they save money during truck use. With the Eurovignette Directive, the EU has created a corresponding framework regulation, but so far it has only been implemented to a limited extent.

Recently, there have been increasing calls from industry for technological openness: emission targets could be achieved not only by switching to electric drives, but also with e-fuels – synthetic fuels for combustion engines. What is your view on this?

Sparber: In my view, it is not surprising that manufacturers of combustion engines are trying to pull out all the stops to keep their core business going for as long as possible. From an overall energy perspective, however, e-fuels are unfortunately quite inefficient and significantly more expensive than conventional fuels. And combustion engines are many times more inefficient than electric motors – with a conventional engine, 60-70 percent of the energy is lost as heat, compared to only 10 percent with electric motors. So combustion engines powered by e-fuels are enormously inefficient, and that naturally has an impact on costs.

So e-fuels don't make economic sense?

Sparber: For large, intercontinental shipping or air routes, for which battery technology does not yet exist, these fuels may be an option, but not for road transport. Another factor comes into play here: The battery market is growing much faster than was assumed and this has led to a sharp drop in battery prices of less than 84% between 2014 and 2024 according to Bloomberg NEF. And they continue to fall. We have also seen this development in solar and wind energy. Electric cars are not only getting better and better technologically, they are also getting cheaper and cheaper. In a few years, electric vehicles will be consistently cheaper than conventional vehicles.

Despite many successes, misconceptions about electric cars persist...

Sparber: This is not surprising either: a transformation is taking place that is being resisted by a financially well-equipped lobby. Of course, it is using its resources to spread half-truths and confusing information. Certain automobile clubs, for example, made a clear effort to discredit electric cars in terms of their carbon footprint and make diesel vehicles look good – so in my view, the connection to the local automotive industry was obvious. In times of transformation, it is normal for the established industry, which is losing market share, to have more financial resources and be able to communicate more loudly than the young, emerging industry.

Keyword: lobbying. Given the millions that the automotive industry invests to represent its interests, how difficult is it to get independent research results heard?

Sparber: Fortunately, a lot has happened in this area. For example, the ICCT (International Council on Clean Transportation) is doing very good work, taking up and disseminating international studies, conducting its own research, and producing analyses for public authorities. International organizations such as the IEA (International Energy Agency) and IRENA (International Renewable Energy Agency) produce frequently cited reports on energy transformation, costs, and market developments at short intervals. But private think tanks such as EMBER and Transport&Environment also produce easily accessible and graphically well-presented studies and data on energy and transport topics, thus complementing purely scientific publications, which are often reserved for a small specialist audience.

One strongly industry-driven association, of which our institute is also a member, is E-Mobility Europe, which aims to promote the development of a competitive European electric vehicle industry and strives to provide counterarguments to the fossil fuel car industry through analyses and forecasts. The aim is to ensure that the discussion is not limited to job losses but also highlights how many jobs will be created by the switch to e-mobility. The South Tyrolean companies Alpitronic and Intercable, which develop and produce highly efficient charging stations and components for electric cars, are prime examples of how transformation always offers opportunities. They have understood how to seize these opportunities and build great companies that would not exist in their current form without the e-mobility market.

So to accelerate the electrification of transport?

Sparber: If we want to move towards zero emissions by replacing fossil fuels with renewable electricity in more and more areas, then electricity must be cheap. In most cases, renewable electricity is already cheaper than that generated by gas-fired power plants. But that is not enough; electricity system costs and taxes must also be reduced. These could be transferred to fossil fuels, which we want to phase out gradually. For the transformation to succeed, we must look at the system as a whole and address many issues.

A final wish?

Sparber: That Europe is able to exploit the full potential of this transformation. This applies to research and innovation, industry, jobs, and added value for individual citizens. It means cleaner air in our cities, quieter and safer traffic, and significantly greater geopolitical independence and lower energy costs.

Wolfram Sparber

Wolfram Sparber has headed the Institute for Renewable Energy at Eurac Research since 2005. He was president of the administrative board of SEL, later chairman of the board of Alperia, and is currently a member of its supervisory board. Since 2023, he has been president of the Association of European Research Centres in the field of Renewable Energy.