Manufacturers must push the electric car (or risk fines)

Few brands will meet the emissions targets set by Europe, while the others will pay penalties of up to 15 billion

Volkswagen e-factory

By: Francesco Barontini

Published by: Brian Potter

Sep 10, 2024 at 4:52am ET

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With the ecological transition slowing down and the growth of electric cars struggling to regain momentum, manufacturers are taking a big risk. In Europe, in fact, they could fail to meet their emission targets and this could lead to fines of up to EUR 15 billion in total.

Raising the issue was Luca De Meo, CEO of Renault, who referred to the penalties set by the EU on the average CO2 emissions of individual manufacturers' fleets.

By 2025 manufacturers should achieve an average value of less than 94 g/km. As is already the case, those who do not comply with the limit will pay 95 euros for every gram more per car sold.

How the manufacturers are doing

The landscape, as can be guessed, is varied. Tesla and Volvo, for example, are well within the parameters set by the authorities. Other manufacturers, such as Hyundai, Kia and Stellantis, are close to meeting the targets. However, they risk fines of a few hundred euros per car sold if they fail to lower the average emission value of their fleets.

This is according to a report by Dataforce, which shows that Toyota, which is still far behind on electric car sales, has met the targets set by the European Union thanks to the hybridisation of its entire range. Other manufacturers, however, are worse off. Ford and Volkswagen, for example, who have allied themselves, seem to be in dire straits. They are quite far behind on targets and it is estimated that fines for them could be as high as EUR 2,000 per car sold.

Ford Capri (2024)

Ford

volkswagen-id.5

Volkswagen ID.5

We need to push on electric

De Meo, in his speech, emphasised that the speed of growth of electric cars is half of what is needed to reach the targets and not pay the fines. 'Everyone talks about 2035,' added the Renault Group's number one, 'but we should look more carefully at 2025. Because today we are already in trouble. We need some flexibility: setting deadlines and fines without being able to make them flexible is very, very dangerous'.

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It is also true that ACEA (the European manufacturers' association of which De Meo is president) has stated that the 2025 targets should remain unchanged because any proposed changes would still not leave manufacturers enough time to adapt their production processes to any new impositions.

Luca de Meo at the Paris Salon 2022

Transport & Enviroment, for its part, has published a study showing that in previous years manufacturers have often pointed out that the rules proposed by the EU were too stringent, but, on balance, have put little effort into meeting the restrictions coming this year. Once they found themselves in a corner, however, they were able to drastically reduce average emissions in a short time to avoid excessive penalties. The question raised is: have they really made an effort to have greener fleets?

Not going as planned in Europe:

Toyota allegedly scales back electric car plans

Volkswagen in crisis! Tough cost-cutting measures announced

Tariffs on Chinese electric cars put Cupra in danger

Electric cars fail to take off, Hyundai prepares more hybrid models