Abstract:

In light of lockdown measures to confine the spread of COVID-19, new vehicle sales have decreased substantially. In response, purchase premiums and vehicle replacement programs are being discussed as recovery measures for the automotive industry in many countries worldwide. Looking back, this briefing reviews the environmental benefits and economic efficiency of vehicle replacement programs implemented in response to the global financial crisis of 2007-2008, with a focus on the largest program by financial volume, the Umweltprämie in Germany.   This briefing estimates the greenhouse gas (GHG) and nitrogen oxide (NOx ) impact of replacing an average 15-yearold passenger car today with (a) an average 2020 car, (b) a car with a maximum of 110 grams of CO2 per kilometer (g CO2/km), and (c) a battery electric car. To inform policies currently being considered, this work quantifies the GHG and pollutant emissions impact of potential vehicle replacement programs in the largest European vehicle markets. Vehicle replacement programs, in contrast, reduce overall GHG emissions even when promoting additional vehicle sales if the avoided GHG emissions of driving the new instead of the old car compensate for the emissions related to the production of the new one.