Sustainable Automobile Transport

Sustainable Automobile Transport

Shaping Climate Change Policy

ESRI Studies Series on the Environment

Lisa Ryan and Hal Turton

Transport, and in particular road transport, represents a significant global threat to long-term sustainable development, and is one of the fastest-growing consumers of final energy and sources of greenhouse gas emissions. In this book, long-term energy–economy–environment scenarios are used to identify the key technological developments required to address the challenges passenger car transport poses to climate change mitigation and energy security. It also considers possible targets for policy support and examines some of the elements that contribute to the significant levels of uncertainty – particularly social and political conditions. The book then builds on this long-term scenario analysis with a broad review of recent empirical examples of relevant policy implementation to identify near-term options for the passenger transportation sector which may promote a shift towards a more sustainable transport system over the longer term.

Chapter 10: Supply-side Policy Measures: R & D

Lisa Ryan and Hal Turton

Subjects: asian studies, asian economics, economics and finance, asian economics, transport, environment, asian environment, climate change, environmental sociology, transport, urban and regional studies, transport


10. Supply-side policy measures: R&D Productivity-enhancing innovation is the lifeblood of modern economies. Without it, stagnation in growth and living standards is inevitable. What is true of economies is true also of sectors and companies. Those that lag in terms of innovation will lag also in terms of growth and market share; ultimately, their survival depends on their success or otherwise in embracing innovation. For firms in the automobile sector, new product development is the very essence of their craft; their survival depends on having a pipeline of new potentially successful products and services. For this reason, automobile industry analysts examine carefully what products are in the pipeline, and how much and to what effect expenditure is devoted to R&D. As the number of vehicle manufacturers globally has shrunk through takeovers and mergers, there has been sluggish growth in major car markets and a rapid expansion of production capacities in emerging markets, leading to stronger competition in the traditional segments of the car market, and process innovation to keep production costs low (CEC, 2004c). This trend can have both a positive or negative effect for the development of environmental technology: either these technologies become increasingly important as a means by which companies can retain an edge over competitors, or margins become so narrow that companies are unable to afford to invest in technology research. Furthermore, large firms may be able to pursue more risky technologies, whereas small companies may lack the necessary capital or management...

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