Towards smart and sustainable transportation: the role of artificial intelligence and new technologies in mitigating passenger car CO₂ emissions in European countries

Road transport-related emissions constitute one of the major portions of global emissions, including 77% of all EU transport CO₂ emissions in 2020. In terms of specific modes of road transport, passenger cars are the greatest contributor to pollution, as highlighted during COP28. Unlike previous studies, this research aims to scrutinize the role of technological innovation, especially focusing on the role of artificial intelligence and new technologies in interacting with passenger cars to mitigate climate change. For this purpose, this study used a panel of 29 European countries from 1998 to 2017 and used the system generalized method of moments estimator. This empirical strategy allows us to estimate the direct, indirect, and net effects of adopting innovation in cars on CO₂ emissions. The empirical outcome revealed that passenger cars, information and communication technology and per capita income growth further deteriorate the environment. However, the joint effect of technological progress and passenger cars helps to curb CO₂ emissions. The role of artificial intelligence is found to be substantial in alleviating emissions in European countries. Threshold policies are evaluated to help improve decision-making toward environmental preservation. This study recommends technological progress with environmentally friendly passenger cars to mitigate pollution.