The emissions gap has not changed in the last year, analysts said. "Given the CO2 cliff the industry is facing, and as we have written before, one would have hoped for a smooth transition toward improved fuel efficiency," ISI's Arndt Ellinghorst said in a note in December. "Instead, we continue to observe very little improvement."

Ellinghorst and his colleagues at ISI say the risks of fines are very real. "The current CO2 performance is simply not good enough and we continue to flag that carmakers run the risk of facing considerable fines if more is not done," he said.

But the lack of progress on CO2 emissions might be strategic, argued Al Bedwell, who is director of global powertrain forecasting at LMC Automotive. "We shouldn't be surprised that the CO2 trend has not yet started to move in a positive direction for many automakers," he said in a note. "There is no incentive for automakers to start selling their most fuel-efficient products before January," especially those that may be less profitable, such as plug-in hybrids, than conventional internal combustion cars.

For automakers operating in Europe, convincing consumers to buy cars that they have shunned in the past is a bit like playing chess in three dimensions: There are many moves they can make, whether in sales, marketing, production and even registration. On top of that are national incentive programs that vary widely from country to country.

Cautiously confident

In interviews with Automotive News Europe this autumn, top executives at brands that are sold in Europe were mostly confident that they would not be paying any emissions fines. But they expressed a bit of uncertainty as to how the overall market would reach its target.

"We are preparing to supply electric vehicles in sufficient volume and to deliver them without long delivery times to our customers," said Thomas Schmidt, the head of Hyundai's European operations. "However, everyone has to sell many more battery-electric vehicles. That raises some questions: Does the European market have that many customers who want to buy a full-electric car? How long will it take for the national governments to put in place a strategy to roll out a sufficient number of charging stations?" Hyundai's low-emissions lineup includes the Ioniq compact sedan, in electric or plug-in versions and the Kona small SUV in an electric version.

PSA Group CEO Carlos Tavares has been adamant that none of his company's brands, including Peugeot, Citroen, Opel and DS, will be liable for any emissions fines. "For us, it's an ethical and not just a financial matter" to meet CO2 targets, he told ANE. He did not offer any details, however, on how the brands would meet a target of 7 percent of sales of electric and plug-in hybrid vehicles.

"We have a very precise process -- I can't say a lot about it because it's highly competitive -- that involves our production, our order book, and making our dealers actors in what we are doing, not just followers," Tavares said. PSA has just started a big push into electrification, with electric versions of the Peugeot 208 small hatchback and 2008 small SUV, the Opel/Vauxhall Corsa small hatchback and the DS 3 Crossback small SUV about to go on sale. Plug-in models include the Peugeot 3008, Opel/Vauxhall Grandland and DS 7 Crossback compact SUVs, and the Peugeot 508 midsize sedan and station wagon.

Peugeot brand CEO Jean-Philippe Imparato said his brand had been preparing for the changeover by "monitoring every high-emissions car that is in stock" or in the dealer network. "I don't know how other automakers will manage their operations," he told ANE, "but we will be compliant in January."

But not every executive is so confident about avoiding fines. Michael Jost, chief strategist at Volkswagen Group -- which faced issues in 2018 meeting deadlines for the new Worldwide harmonized Light vehicle Test Procedure, or WLTP -- said, "Next year and 2021 might be challenging since we will be ramping up our EV models," including the highly anticipated ID3 full-electric compact hatchback. "We will work hard to be CO2 compliant and we are pretty sure we will reach all the goals set for the passenger cars," Jost said.