The car industry is recoiling after the European Commission confirmed on Wednesday it will implement a mandatory 130g/km CO2 limit for the carmakers, some 10g/km lower than the self-imposed 140g/km targets.

The legally binding average was introduced by the Commission following clear evidence the industry was failing to meet the self-imposed voluntary 140g/km CO2 target with the car industry averaging more than 160g/km in 2005.

The new 130g/km limit is itself 10g/km CO2 lower than originally proposed, but carmakers are still expecting to struggle to meet the stringent new target that must be achieved by 2012.

Industry insiders are already talking potential plant closures, subsequent loss of jobs, a sales migration from European brands and rising car prices.

Environmentalists are also disappointed by the retreat from the original more demanding 120g/km average, with some citing the higher limit as a ‘reward’ for the industry and not enough to stem global warming.

The 130g/km average will apply to the industry as a whole, rather than targeting individual manufacturers, although the precise manner of how the target will be enforced and applied are, as yet, unknown.