Cars and Vans

Countries and regions making notable progress in reducing the emissions of cars and vans include: 

• In 2023 the European Union announced stricter CO₂ emission standards for cars and vans to ensure carbon neutrality by 2050. In addition, low-emission zones (areas that charge fees on or otherwise restrict the operations of high-emitting vehicles) are becoming more prevalent in the region, which could potentially incentivise the adoption of electric vehicles (EVs) in the future. 
• In the United States, electric cars reached a new record market share of nearly 8% in 2022, up from less than 5% in 2021.  The market for electric cars is expected to keep growing, spurred on by the recent Inflation Reduction Act (IRA), which provides a new tax credit for the purchase of EVs. Additionally, in April 2023, the Environmental Protection Agency (EPA) announced the “Multi-Pollutant Emissions Standards for Model Years 2027 and Later Light-Duty and Medium Duty Vehicles”.  
• Australia announced its first National Electric Vehicle Strategy in 2023, aiming to reduce emissions and make EVs more affordable. As a crucial part of the strategy, a Fuel Efficiency Standard is expected to be introduced in due course. 
  

In 2022, total CO₂ emissions of cars and vans remained close to 2021 levels. The global stock share of electric light-duty vehicles reached  2%, avoiding around 450 kb/d (860 GJ) of oil use in the year 2022 alone. In addition, China's Zero Covid policy resulted in less vehicle activity.  

Emissions from light-duty vehicles will need to fall by around 6% each year through 2030 to get on track with the NZE Scenario. Rapid electrification, accompanied by increasing fuel efficiency in conventional cars, are key for ensuring carbon neutrality over the long term. Policies such as tax credits for EVs, “feebate” schemes, and targeted incentives or fleet requirements for the purchase of EVs with high utilisation rates (such as taxis or postal fleets, or urban delivery vehicles) could support this effort.  

Between 2000 and 2015, the average annual reduction in specific fuel consumption (measured in litres of gasoline equivalent per 100 km [lge/100 km]) was 1.3%, thanks to improvements in conventional engines and hybridisation. However, improvements slowed to 0.8% per year between 2017 and 2019, as technical improvements were counteracted by rapidly increasing vehicle power and weight, and the growth in sales shares of SUVs. From 2019 through 2022, rapid electrification has outpaced the effects of increasing car size, leading to an annual improvement of around 1% in the fuel economy of new vehicle sales at the global level. 

Among developed economies, the United States and Canada have the least fuel-efficient cars and vans, largely as a result of the high and growing share of pick-ups and SUVs in those markets. Conversely, France, Italy and Japan all have very fuel-efficient cars and vans, mainly due to policies that have incentivised the purchase of smaller personal vehicles (such as France’s bonus-malus programme – a revenue-neutral scheme which taxes cars with high fuel consumption, and uses the revenues collected to subsidise the purchase of fuel efficient cars – and Japan’s exemption of the smallest “Kei” cars from the “garage certificate”, a proof-of-parking requirement).  

To get on track with the NZE Scenario pathway, the average reduction in specific fuel consumption will need be around 9% per year globally to 2030, largely through rapidly increasing sales of conventional hybrids and zero-emission vehicles. 

In 2022, SUVs¹ accounted for around 46% of global car sales, with noticeable growth in the United States, India and Europe. The combustion-related CO₂ emissions of SUVs increased by nearly 70 million tonnes in 2022. Altogether, the 330 million SUVs on the road today emit nearly 1 billion tonnes of CO₂. 

A shift to smaller vehicles will be required to get on track with the NZE Scenario, alongside an overall decline in car and van activity to reduce future CO₂ emissions. A variety of policies can incentivise an “avoid and shift” approach, such as integrated urban and transport planning, increased public funding and public-private financing of public transport (e.g. rail and bus) infrastructure and operations and transport demand management. 

¹The definition of SUVs varies by country, but goes beyond a passenger car with features from off-road vehicles (i.e. 4 X 4). This analysis includes in the Sport-Utility Vehicles category smaller SUVs, known as crossovers, as well as the larger ones. An average SUV in America falls under the large SUVs category but crossovers are the most popular options in the European market. 

In 2022, the market share of electric light-duty vehicles (including battery electric and plug-in hybrid vehicles) reached more than 12% of total light-duty vehicle sales at a global level. Around 16 000 hydrogen-powered fuel cell electric vehicles were sold globally. To align with the NZE Scenario pathway, about two-thirds of new light-duty vehicle sales will need to be electric by 2030. 

In countries where electromobility is more advanced, there is a shift in focus from subsidising private EVs towards supporting the development of charging infrastructure. In 2022 more than 900 000 public chargers were installed, reaching a global total of 2.7 million. 

To ensure continuing market uptake of electric light-duty vehicles in line with NZE targets, this number would need to increase by 6 times by the end of this decade. 

Between 2022 and 2023, an increasing number of countries proposed policies to accelerate the transition to electric cars.  

In the European Union, the regulation mandating zero tailpipe CO₂ emissions for new cars and vans sold from 2035 onwards has been fully approved and will soon enter into force. Euro 7, a new emission standard applicable to all cars and vans, has also been proposed by the European Commission. It will ensure that emission testing conditions are more representative of real life, including increasing the scope to cover braking and microplastics emissions, extending the compliance period for in-use vehicles, and regulating EV battery durability. In addition, a proposal to add a separate  Emissions Trading System (ETS) that would include road transport emissions has been formulated. 

In August 2022 the United States launched the IRA, which provides tax credits for domestically manufactured EVs (see the Global EV Outlook for more information). Additionally, in April 2023 the US EPA announced new emission standards for vehicles. These emission standards are anticipated to bring substantial health benefits, while also accelerating the shift towards EVs and stimulating the advancement of CO₂ mitigation technologies in internal combustion engine vehicles. 

In addition, large and growing car markets such as Indonesia and India, where electric car uptake has been limited to date, are increasingly introducing policies such as tax exemptions for electric cars, equipment and parts, alongside purchase incentives and deployment targets. 

Technical and financial assistance to Emerging Market and Developing Economies to accelerate the transition to electric mobility is ramping up. One prominent example of such efforts is UNEP’s Global Electric Mobility Programme, in which assistance is being delivered at sub-national, national, and regional level to over 50 countries, 27 of which are being funded by the Global Environment Facility (GEF-7) partnership to accelerate electric mobility. 

• François Cuenot, UNECE