Volkswagen, Europe's biggest car brand in terms of sales, has improved fuel efficiency at less than half the rate needed, according to the study.

"In contrast, Renault, Europe's second biggest brand and a direct competitor of VW, is on track to meet the target for the average new car sold to emit 140 grams of carbon dioxide (CO2) per kilometre by 2008," the Brussels-based lobby group said in a statement.

The study was produced to track the progress of individual car brands in reducing carbon dioxide (CO2) emissions under the terms of a commitment made by the car industry to the EU in 1998-1999. The target is reduced to 120 grams per kilometre by 2012.

The deal included an agreement not to disclose the performance of individual companies in cutting emissions.

According to the European Commission's environment spokesman, Barbara Helferrich, the automakers are not doing enough to meet the voluntary targets so legislation may be necessary.

The latest report to the EU's executive arm, delivered in August, found that manufacturers were reducing CO2 emissions in new cars, "but the reductions year by year are decreasing".

"This leaves us to believe they will have an increasingly hard time meeting their target," Helferrich told AFP.

That "would be reason enough to start legislation", she added, without putting a date on any such action.

According to the T and E study, 75 percent of carmakers are failing to cut emissions fast enough.

Nissan was named as the worst performer, in terms of emissions, followed by Suzuki, Mazda, Audi, Volvo, BMW and Volkswagen.

These seven brands all cut emissions at less than half the rate needed to meet their commitment, according to the study. Fiat was named as the best performer in Europe, followed by Citroen, Renault, Ford and Peugeot, with all five said to be on track to meet or exceed the target by 2008.

The study also found that Toyota, maker of the low-emission Prius hybrid, is failing to improve efficiency across its range at the rate needed.

"The study concludes that if climate targets are to be met, companies must improve efficiency across their entire range. One or two very efficient models that sell in limited numbers are not enough." A spokeswoman for the Brussels-based Association of European Automobile Manufacturers said "demand has not been very large" for environmental friendly cars.

"I cannot tell you whether we will or will not achieve this (emissions) target," she added, while stresssing that the industry remained "very committed to reducing CO2 emissions".

She added that, according to the latest data available, from 2004, the European car industry had reached average levels of 161 grams of CO2 per kilometre.

Aat Peterse of T and E said: "Clearly the target is achievable, but as long as seventy-five percent of carmakers go unpunished for their failure, we will never make the necessary progress."

He called on the EU to "kiss its voluntary targets goodbye" and introduce legally-binding measures.

T and E commissioned the Institute for European Environmental Policy (IEEP) in Britain to analyse European sales data from the period 1997-2005.

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