A ROW has broken out between the Society of Motor Manufacturers and Traders and environmental groups over attempts to slash carbon dioxide emissions from company cars. Cutting CO2 emissions is the cornerstone of the Government's taxation policy for cars because it claims the emissions are harmful to the environment.

But research from the World Wildlife Fund and Transport 2000 has rubbished the policy. It says if current trends in car ownership and travel continue, UK car fuel efficiency would have to increase by 400% - 113mpg on average - by 2020 to achieve the 40% drop in emissions needed to mitigate the short-term effects of climate change. Fuel Taxes and Beyond: UK Transport and Climate Change calculates that to hold transport CO2 emissions constant would require the world's car fleet to average 150mpg by 2020. The report shows the UK managed an average 3.3% reduction in contrast to Sweden which managed a 9.2% reduction.

It claims if past trends continue, CO2 emissions from personal transport in the UK will increase by 70% by 2020. The report says any technological improvements and greater fuel efficiency will be counteracted by people buying larger and less fuel-efficient vehicles, while the number of journeys will increase by 50% and average journey length by 20%. It concludes: 'Improvements to technology and adoption of alternative fuels cannot on their own reduce CO2 emissions to a sustainable level.'

But the claims were attacked by the SMMT, which says the UK has delivered significant cuts in CO2 emissions from new cars, saving nearly 363,000 tonnes since 1997. The SMMT argues while mainland Europe has seen a huge rise in the number of diesel cars, the Government's policy of high taxation for diesel has caused a decline in sales in the UK. It dismissed the WWF and Transport 2000's claims as misleading. A spokesman for Transport 2000 denied the allegations, saying too little was being done in the UK to reduce CO2 emissions.