Brussels  - Europe's carmakers Monday asked governments to provide them with a 40-billion-euro (54-billion-dollar) loan and to approve an incentives scheme for the scrapping of old vehicles to help them develop more environmentally-friendly vehicles at a time of financial and economic crisis.

"Car makers face increasingly hesitant consumers and call on governments to respond, stimulate the economy, relieve the credit crunch and restore consumer confidence," said Christian Streiff, head of the automobile industry's trade association, ACEA.

"Only then will consumers have the means and the confidence to invest in new vehicles," said Streiff, who is also the CEO of PSA Peugeot Citroen.

The request comes on the back of a similar 25-billion-dollar programme approved by the United States Congress.

The European Commission wants car makers to reduce the average CO2 emissions of the cars they sell to no more than
120 grams per kilometre (g/km) by 2012.

But ACEA said that while they had already reduced emissions by 14 per cent over the past decade, they would find it difficult to meet those targets without government help.

"We will continue our work, but do believe that the governments can do more to support our already significant investments and growing number of achievements," Streiff said.

ACEA said the low-interest loan would be used by car makers to "help secure a sustainable market for current and newly developed fuel-efficient technologies."

And the incentive scheme would help convince customers to get rid of cars that are more than eight years old. These currently represent 36 per cent of fleets circulating in the EU's richer countries.

"The replacement with new cars would result in CO2 savings of 20 megatonnes per year, or 4.5 per cent of total passenger car emissions," ACEA said in a statement published in Brussels. (dpa)