The automotive industry is likely to miss climate goals by 75 percent, according to a study backed by electric vehicle makers Polestar and Rivian that was released on Wednesday.

The study, the Pathway report, said the industry would dramatically overshoot the Intergovernmental Panel on Climate Change's target to try to limit the average global temperature increase to 1.5 Celsius by 2050 if automakers did not take action.

"Electrification alone is not the solution – even if every car sold in the world tomorrow would be electric, we're still on track to overshoot," Polestar and Rivian said, adding that they had invited the world's leading car makers to a roundtable and briefing discussion.

The report suggests three "levers" to have a chance at achieving the target by 2050: including a firm end date for selling fossil-fuel cars and investing more in manufacturing capabilities of electric cars; creating more green charging options by investing in renewable energy supplies to global grids; and focusing on more sustainable supply chains.

Climate goals have been at the forefront of carmakers' priority for the past decade as customers become increasingly sustainability-conscious, with the recent energy crisis and war in Ukraine underscoring the importance of accelerating the green shift.

Swedish automaker Volvo Cars is among those that have pledged ambitious goals, promising that by 2030 it will sell only electric cars.

Setbacks

It also plans on reducing emissions across its entire value chain, aiming to become a climate-neutral company by 2040. Other carmakers have similar goals.

Despite the will of automakers to make the shift, geopolitical and macroeconomic conditions have continued to make life difficult for the industry, with higher costs, component shortages and supply chain issues continuing.

Rivian is one of the companies that has struggled with production ramp-up for its vehicles and has been squeezed further as EV giant Tesla cut its prices. In early February, Rivian said it would lay off six percent of its workforce in an effort to cut costs.

Auto suppliers are also struggling with coping with the additional costs of making their components sustainable in order to meet the sustainability goals of carmakers.

- Reuters