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Highlights
- Six major automakers pledged to phase out the manufacturing of fossil fuel vehicles across the globe by 2040.
- The US, China and Germany are not a part of the pledge yet.
- Big brands, like Toyota Motor Corp and Volkswagen AG, which are the top two carmakers worldwide, have not committed yet.
The UK Government has recently stated that six major automakers will pledge to phase out the manufacturing of fossil fuel vehicles across the globe by 2040. The move would support goal of cutting carbon emissions and fighting climate change. However, certain big brands, like Toyota Motor Corp and Volkswagen AG, which are the top two carmakers worldwide, have not signed up. Additionally, significant car markets China, Germany and the US have also not signed up for the pledge. This will hamper the global efforts to transition to a zero-emission future.
As per International Energy Agency’s data, around one-fourth of all global carbon emissions are credited to cars, buses, trucks, ships, and planes, out of which road vehicles contribute the most. The companies which are set to sign the pledge at the COP26 being hosted by the UK in Glasgow include Sweden's Volvo, US automakers Ford Motor Co and General Motors Co, Daimler AG's Mercedes-Benz, China's BYD Co Ltd and India’s Tata Motor’s unit, Jaguar Land Rover. Volvo has already pledged to transition to entirely electric by 2030.
Countries like New Zealand and Poland have already pledged to manufacture zero emission vehicles by 2040 or earlier. However, the pledge will potentially be ineffective unless two of the world’s biggest car markets, the US and China, become a part of the global initiative.
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Let’s take a look at some of the global automobile stocks which may be impacted by the pledge.
Toyota Motor Corp (LON: TYT)
Japanese global manufacturer of automobiles Toyota Motor Corporation is among the biggest automobile manufacturers across the globe, manufacturing around 10 million vehicles every year. Apart from being listed on the Tokyo Stock Exchange, it is listed on the LSE, NYSE, and the Nagoya Stock Exchange. It falls under the Nikkei 225 and TOPIX Core30 indices. Its market cap stands at 32.72T JPY. Its shares were trading at 2,006 JPY as of 10 Nov, 3:00 pm GMT+9.
AB Volvo (STO: VOLV-B)
Swedish global manufacturer of trucks, buses and construction equipment Volvo Group is also engaged in offering financial services and marine and industrial drive systems. It is listed on the on the Nasdaq Stockholm, Sweden stock exchange. The market of AB Volvo stands at 418.65 billion SEK. Its shares were trading at 205.05 SEK as of 9 Nov, 5:29 pm GMT+1.
General Motors Company (NYSE:GM)
American global manufacturer of automobiles General Motors Company ranks among the top automakers in America and worldwide. It is a component of the S&P 100 and the S&P 500. Its market cap stands at US$85.11 billion. The shares of General Motors were trading at 58.62 USD as of 9 Nov, 7:54 pm GMT-5.
RELATED READ: 2 EV focused stocks to buy as global automakers step up electric plans
BYD Co. Ltd. (SHE: 002594)
Chinese automobile manufacturer BYD Co. Ltd. operates through its two major subsidiaries. These include BYD Electronic and BYD Automobile. It is listed on the Shenzhen Stock Exchange. Its market cap stands at 833.06B CNY. The shares of BYD Co. Ltd were trading at 310.26 CNY as of 10 Nov, 2:54 pm GMT+8.
Daimler AG (ETR: DAI)
German global manufacturer of automobiles, Daimler AG, was created in 1926 as Benz & Cie. and Daimler Motoren Gesellschaft merged. Its market cap stands at 93.53B EUR. The shares of Daimler AG were trading at 87.42 EUR as of 9 Nov, 5:35 pm GMT+1.
