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March 14, 2023 09:00 AM

Porsche CEO defends e-fuels strategy

Oliver Blume's position aligns with key players in Porsche's home market of Germany, which wants e-fuels to be exempted from the EU's planned phase-out of combustion engines.

Douglas A. Bolduc
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    VW Group CEO Oliver Blume
    REUTERS

    "If e-fuels are approved for the future, this will not lead to a change of Porsche's strategy," CEO Oliver Blume said.

    Porsche CEO Oliver Blume does not see any conflict between the sports-car maker's electric ramp-up and its push for e-fuels to be exempted from a planned ban of internal combustion engines in Europe.

    "If e-fuels are approved for the future, this will not lead to a change of Porsche's strategy," Blume said during the Volkswagen Group subsidiary's annual press conference on Monday.

    What are e-fuels

    E-fuels, like e-kerosene, e-methane, or e-methanol, are made by synthesizing captured CO2 emissions and hydrogen produced using renewable or CO2-free electricity.

    The fuels release CO2 into the atmosphere when combusted in an engine. But the idea is that those emissions are equal to the amount taken out of the atmosphere to produce the fuel -- making it CO2-neutral overall.

    That strategy includes having electric cars such as the battery-powered Macan due next year account for more than 80 percent of the brand's sales by 2030.

    Porsche, however, is a major advocate for e-fuels, seeing them as a carbon-free way of driving combustion engine cars such as its iconic 911 in the future.

    Blume's position aligns with key players in Porsche's home market, as Germany has formed an alliance with Italy and some Eastern European countries opposing the planned phase-out of combustion engines starting in 2035 unless cars running on e-fuels are exempted from the ban.

    German transport minister Volker Wissing said skepticism about phasing out internal combustion vehicles was shared by Italy, Poland and the Czech Republic, among others.

    Meanwhile, countries such as France and Spain oppose the change.

    Monday the European Union must stick to a plan to ban new combustion-engine cars by 2035.

    "We cannot say there is a climate emergency but retreat from the transition to electric vehicles," French Finance Minister Bruno Le Maire said Le Maire said Monday on French TV. "We are ready to fight on this as it is an environmental mistake and an economic mistake."

    He said Europe is five to 10 years behind China in developing electric cars and must avoid sending inconsistent messages to automakers including France's Stellantis and Renault.

    Germany's Wissing said the group of countries pushing for the change wants a separate category of combustion-engine cars that could run on synthetic, carbon-neutral e-fuels, after 2035.

    "If you take climate protection seriously," Blume said. "Then you have to sweep clean each and every corner of your home."

    He said Porsche is taking a global view when it comes to the reducing emissions rather than seeing the issue through a German or European lens.

    "In Europe we are electrifying cars very quickly because we have got the infrastructure. But if you think of continents like South America, Africa and India, I'm sure things will not work out so quickly," Blume said. "Therefore, it will certainly help if we look at climate action on a global level."

    Supporters say e-fuels offer a route to cut the CO2 emissions of the existing passenger car fleet, without replacing every vehicle with an electric one.

    Critics highlight that manufacturing e-fuels is very expensive and energy intensive. Using e-fuels in an internal combustion engine (ICE) car requires about five times more renewable electricity than running a full-electric vehicle, according to a 2021 paper in the Nature Climate Change journal.

    Blume believes taxes can be adjusted to make e-fuels cheaper.

    "It is worth it," Blume said. "I know no other possibility to decarbonize combustion engine cars."

    He added that e-fuels are easy to transport. "The existing tank infrastructure can be used without problems.

    The Porsche boss also made no secret that the brand's position on e-fuels is tied to the future of its most iconic model.

    "The 911 will be offered as a car with an ICE as long as it is possible," he said.

    He referred to future-generation models powered by e-fuels such as the 911 and other "vintage cars" as being "niche products."

    "I'm sure that the owners of such cars will be very happy about an offer like this [using them with e-fuels] with a very low CO2 emissions," he said.

    The 911, which Porsche said will soon be offered at a hybrid, is considered difficult to electrify because then its driving characteristics would be lost. With synthetic fuels, the 911 could be built beyond 2035.

    Michael Gerster and Reuters contributed

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