ANALYSIS OF AUTO INDUSTRY AND CONSUMER RESPONSE TO REGULATIONS AND TECHNOLOGICAL CHANGE, AND CUSTOMIZATION OF CONSUMER RESPONSE MODELS IN SUPPORT OF AB 1493 RULEMAKING CASE STUDY OF LIGHT-DUTY VEHICLES IN EUROPE

Diesel vehicle sales in the European Union have increased from 23% of all light duty vehicles sold in 1994 to 41% in 2002. This rapid increase in market penetration is due to four related factors: a voluntary agreement by European automobile manufacturers in 1998 to reduce CO2 emissions from new light duty vehicles by 25% from 1995 levels by 2008; significant advances in diesel technology; preferential fuel and vehicle pricing in most European countries; and preferential European Union regulation of diesel emissions. However, the growth in sales is not uniform throughout Europe, largely due to differences in fuel and vehicle pricing.