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Porsche faces hefty fines from US fuel efficiency law

German sports car manufacturer Porsche could soon face severe fines in the United States thanks to a proposed law meant to encourage greater fuel efficiency, daily Financial Times Deutschland reported on Monday.

Porsche faces hefty fines from US fuel efficiency law
And why not a fine for choosing a yellow Porsche? Photo: DPA

“For the model years of 2012 to 2015 we’ve received a special exemption,” the company’s chief lobbyist Stephan Schläfli told the paper. “But as of 2016 it’s no longer valid.”

The paper reported the new regulations could go into effect this May, and means that Porsche will have to improve average new vehicle fuel efficiency to 41.4 miles per gallon, or about 5.7 litres per 100 kilometres. But this level is significantly higher than current measurements of about 27 miles to the gallon, and the new target is unrealistic within the time frame – despite receiving an extension until 2016, experts told the paper.

“To reach this value we have to reduce fuel consumption by around 10 percent year for year,” Schläfli said.

Critics of the bill have also said that other German car companies, who tend to sell powerful cars with big motors in the United States, are being unfairly disadvantaged, the paper reported. Some experts believe this may not be a coincidence, because most US carmakers are able to fulfil the new rules.

“Economically this rule will restructure the entire industry,” warned Walter Lewis, Porsche’s liaison to US lawmakers. “It’s not the task of the government to decide on the winners and losers in the auto industry. This is not environmental policy, it’s industrial policy.”

For years Porsche has paid fines for not reaching American fuel efficiency standards, but the cost to consumers has only been about $100 per car, the paper reported.

“With the new law the highest fine is now $37,500 per car,” Schläfli told the paper. “We can’t pay that any more.”

One solution may be for Porsche to offer its larger Cayenne and Panamera models with hybrid engines, he said, adding that it remains doubtful whether customers would be interested in the change.

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BUSINESS

France’s EDF hails €10billion profit, despite huge UK nuclear charge

French energy giant EDF has unveiled net profit of €10billion and cut its massive debt by increasing nuclear production after problems forced some plants offline.

France's EDF hails €10billion profit, despite huge UK nuclear charge

EDF hailed an “exceptional” year after its loss of €17.9billion in 2022.

Sales slipped 2.6 percent to €139.7billion , but the group managed to slice debt by €10billion euros to €54.4billion.

EDF said however that it had booked a €12.9 billion depreciation linked to difficulties at its Hinkley Point nuclear plant in Britain.

The charge includes €11.2 billion for Hinkley Point assets and €1.7billion at its British subsidiary, EDF Energy, the group explained.

EDF announced last month a fresh delay and additional costs for the giant project hit by repeated cost overruns.

“The year was marked by many events, in particular by the recovery of production and the company’s mobilisation around production recovery,” CEO Luc Remont told reporters.

EDF put its strong showing down to a strong operational performance, notably a significant increase in nuclear generation in France at a time of historically high prices.

That followed a drop in nuclear output in France in 2022. The group had to deal with stress corrosion problems at some reactors while also facing government orders to limit price rises.

The French reactors last year produced around 320.4 TWh, in the upper range of expectations.

Nuclear production had slid back in 2022 to 279 TWh, its lowest level in three decades, because of the corrosion problems and maintenance changes after
the Covid-19 pandemic.

Hinkley Point C is one of a small number of European Pressurised Reactors (EPRs) worldwide, an EDF-led design that has been plagued by cost overruns
running into billions of euros and years of construction delays.

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