Emission scandals need a global response

Revelations of global auto-emissions cheating demonstrate how difficult it would be to rein in global warming. Embarrassingly, the cheating
reports continued to stream in, while the world leaders were gathering in New York on Friday to sign the landmark Paris Climate Accord.
It is but a paradox that such scandals come from major auto companies in the developed countries who are expected to lead the world in tackling global warming. The revelations evoke doubts raised by scientists and environmentalists whether the cap of 2 degree Celsius set by the Paris deal could really mitigate global warming. All the carefully-negotiated terms of the Paris climate accord could fall well short of their desired goals if real-world emissions
remained higher than the lab test scores used in negotiations.
As the scandal spreads, around 630,000 Audi, Mercedes, Opel, Porsche and Volkswagen (VW) cars are to be recalled in Europe owing to irregularities in their emission of pollutants.
To deal with the aftermath of the scam, VW has budgeted $18.2 billion to cover the cost of repairs and buybacks associated with its US settlement and recalls in Europe. Its stock is down some 40 percent over the last year.
Earlier, VW was caught falsifying CO2 emissions. It was discovered by the International Council on Clean Transportation that the company was cheating on emissions. The revelation shows there are major gaps between carbon dioxide lab results and real-world driving.
The scandal tarnished the reputation of a company once regarded as a paragon of German industry, even if group unit sales already seem to have stabilised.
The emission scandal is spreading globally like a wildfire. Mitsubishi has admitted that it overstated fuel efficiency in more than half a million cars, drawing a raid by Japanese authorities and an investigation by US regulators. The Japanese automaker has lost about 40 percent of its market value in the last week of trading after shock admission that it cheated on fuel-efficiency tests.
In Europe, the British authorities announced this week that their testing shows diesel cars emitting an average of six times the legal limit of nitrous oxides, an air pollutant, in real-world conditions. The French automaker PSA Peugeot-Citroen could also find itself crossing the ill-defined line between non-compliance and active cheating, as French fraud authorities raided five of its facilities.
The scandals have impacted the markets. The Frankfurt market was hit when Volkswagen shares slid 1.3 percent, while Daimler, the parent of Mercedes Benz, lost 5.1 percent after reporting a 31 percent fall in profits and revealing that it was launching an internal investigation related to exhaust emissions following a US Justice Department request.
Tech giants were not spared as disappointing quarterly results were reported by Microsoft and Alphabet, the parent of Google. Microsoft lost 7.2 percent as its cloud business continues to fall short of expectations, and Alphabet tumbled 5.3 percent as its ad sales brought in lower returns.
Bending or breaking the rules on nitrous-oxide emissions by automakers is linked to elevated rates of respiratory diseases and cancer in cities with large diesel fleets.
Needless to say, the auto emission cheating scandal could be a blessing in disguise. If handled soberly, it would further advance the environment cause. It is high time for the governments to collaborate on new real-world emissions
testing standards that could cut down on rule-bending and outright cheating. Without doing so, the Paris deal will be a myth.
Though the auto-emissions scandal could dent the capital and credibility of automakers in the US, Europe and Asia, it should be used to broaden a coordinated global response to adhere to standardized environment-friendly rules.