PARIS (Reuters) – Europe’s autos industry could face fines of 15 billion euros ($17.4 billion) for carbon emissions due to slowing demand for electric vehicles, Renault (EPA:) CEO Luca de Meo said on Saturday.
Automakers face tougher EU CO2 targets in 2025 as the cap on average emissions from new vehicles sales falls to 94 grams/km from 116 g/km in 2024.
“If electric vehicles remain at today’s level, the European industry may have to pay 15 billion euros in fines or give up the production of more than 2.5 million vehicles,” de Meo told France Inter radio.
“The speed of the electric ramp-up is half of what we would need to achieve the objectives that would allow us not to pay fines,” de Meo, who is also president of the European Automobile Manufacturers Association (ACEA), said of the sector.
Exceeding CO2 limits can lead to fines amounting to 95 euros per excess CO2 g/km multiplied by the number of vehicles sold.
That could result in penalties of hundreds of millions of euros for large carmakers.
“Everyone is talking about 2035, in 10 years, but we should be talking about 2025 because we are already struggling,” he said.
“We need to be given a little flexibility. Setting deadlines and fines without being able to make that more flexible is very, very dangerous.”
Conclusion
Europe’s autos industry is facing a critical challenge in meeting the stringent EU CO2 targets by 2025. The slowing demand for electric vehicles has put automakers in a tough spot, with the risk of facing hefty fines for exceeding emission limits. Renault CEO Luca de Meo has raised concerns about the industry’s ability to ramp up electric vehicle production to avoid these fines.
With fines potentially amounting to billions of euros, the industry must accelerate the transition to electric vehicles to meet the regulatory requirements. De Meo’s call for flexibility in deadlines and fines highlights the need for a more sustainable approach to achieving emission targets.
As the automotive sector navigates these challenges, it is clear that innovative solutions and strategic partnerships will be key to driving progress towards a greener future. Only by embracing change and working together can automakers overcome the obstacles ahead and pave the way for a more sustainable industry.
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