Europe’s carmakers have warned that the European Commission’s proposals to fine them if their new cars’ emissions exceed maximum levels of CO2, are unrealistic and will make the European automotive industry uncompetitive.

The proposals, which if left unchallenged will become law within 18 months, will set the average permitted level of CO2 emitted per car at 130g/km by 2012 (another 10g/km will have to be saved through additional solutions such as alternative fuels and energy saving tyres).

While manufacturing groups, such as Volkswagen AG, which owns marques from Bentley to Skoda, can group all of their marques together to find the average, many of Europe’s carmakers will still fail to meet the proposed 2012 targets.

The fines they face will run into billions of euro.

“There is a total disconnection between the legislators and reality…CO2 emissions from cars need to be reduced in a cost-effective way,” said Ivan Hodac, secretary general of ACEA – the European automobile manufacturers’ association.

“The level of the compensation payments should be no higher than for other sectors that miss their CO2 emissions targets.”

Under the proposals, carmakers will be paying up to 100 times more than other industries penalised for excess carbon emissions.

Mr Hodac said the auto sector will put immense pressure on the legislators in the run up to the proposal becoming a regulation.

Not only will ACEA be pressing for a fairer penalty, but it will also press for a longer lead-in time – 2015 rather than 2012 – so that carmakers can integrate new greener technology into their upcoming models.