As European automakers for a potential trade war waged by President Trump, they work to prevent another threat to the lawn of their home: the prospect of paying hundreds of millions of dollars for Tesla and Chinese competitors.
According to stricter European Union regulations in force this year, automakers selling cars in Europe face high sanctions if the production of the vehicle does not meet harsh targets to reduce carbon emissions. With the demand for electric cars in Europe and manufacturers squeezed by competition from China, automakers, politicians and industrial groups are pressing for relief.
Following the Brussels industry summit on Thursday, Ursula von der Leyen, chairman of the European Commission, an executive sector of the European Union, acknowledged the challenges he faced and binds that regulators were “fast” to deal with them.
According to the rules, manufacturers can achieve their goals by increasing the number of zero emissions cars that produce or reduce their vehicles with combustion engines.
There is another option: they can buy emissions with “concentration” with companies that only make electric cars and have plenty of credits. In a twist of fate, this has European highways to turn to some of their biggest opponents, including Tesla and Geely in China, who owns Volvo cars and has control of the Polestar electric manufacturer.
The strategy for buying broadcasting credit is not new, but recently put alarms in France and Germany, which hosts Europe’s largest automakers because it comes when demand for electric cars is softening, leading to threats to closing factories and factories. Loss of thousands of jobs. The addition of concerns to Europe is Elon Musk, Tesla’s chief executive, who has criticized EU invoices in electric vehicles in China and has been accused of intervening politics in Britain and Germany.
“A rigid attitude that would lead to billions transferred to Chinese manufacturers, some of whom conquered their European market share through unfair commercial practices or Tesla, whose chief executive Elon Musk is openly attacking European regulations and values, Political mistake.
EU measures also require at least a quarter of all new cars produced this year to be electric. Most of Europe’s major highways, such as Mercedes-Benz, Volkswagen and Stelandis, are not close to hitting their goals. They produce more electric vehicles than ever, but continue to turn cars and trucks powered by gas to meet customer demand.
When Europe began to tighten emission rules in 2021, Stelandis, formed by the merger of PSA Group and Fiat Chrysler, bought about $ 2 billion in Tesla emissions from 2019 to 2021.
Still, this is less than possible sanctions. Luca de Meo, Managing Director of Renault, estimates that paying fines could cost the industry over $ 15 billion this year and Volkswagen told an analyst calling earlier this week that they could face 1.6 billion fines this week dollars.
According to an analysis by the Swiss Bank UBS, Tesla’s compensation could exceed $ 1 billion this year as part of the concentration system. Carbon credits were a benefit for Tesla’s cash flow: The company won $ 1.79 billion from such sales in 2023.
Last year, Tesla’s income from the sale of emissions in Europe, the United States and elsewhere more than doubled in $ 2.8 billion, the company said.
European companies say that a plump rules sets them on a growing disadvantage with the United States, where Mr Trump has vowed to limit business regulations and overturn the rules of self -ruling in his first term. His threats to imposing invoices could further extract European automakers.
Europe’s automotive industry, which employs 13 million people across the 27-member block, is particularly vulnerable. The registrations of new electric cars in Europe declined by 6 % in 2024 compared to the previous year, many of them by Chinese manufacturers, who recorded a 45 % increase in EV sales in Europe. Their market share is expected to grow only.
European car executives argue that the projections made when Brussels approved the ambitious coal cutting work, known as the green agreement, in 2020, does not punish disorders such as supply chain interruptions caused by pandemic constraints Russia’s invasion of Russia, Ukraine.
“The European Green Agreement must be subject to a reality control and a re-enclosure- to make it less rigid, more flexible and to convert the saving of the automotive industry into a green and profitable business model,” Ola Källenius, head of Mercedes- The president of the European Union of Car Manufacturers, wrote in an open letter on January 16 to European leaders.
Regulators insist that Europe remains the course to reduce emissions by 55 % by 2030, compared to 1990 levels. By 2035, the production of new gas vehicles will be banned in Europe.
