Mercedes boss calls for a more realistic strategy for electrification in Europe

Electric car news

The automotive industry is going through a pivotal period with the rise of European environmental regulations. Mercedes-Benz CEO Ola Källenius takes a stand against financial penalties linked to CO2 emissions, sparking a passionate debate on the future of mobility.

New CO2 regulations that are shaking up the industry

From 2025, European car manufacturers will have to respect a strict limit of 95 grams of CO2 per kilometer on average for their new models. Failure to comply with this standard will result in substantial financial penalties, calculated at 95 euros per excess gram multiplied by the number of vehicles sold. This measure is part of the European Green Deal, aimed at 55% reduction in greenhouse gas emissions by 2030.

The objectives vary according to the manufacturers:

• Mercedes-Benz : 91 g/km
• Volvo : 90 g/km
• Stellar: 97 g/km

Mercedes-Benz's controversial position

Ola Källenius, wearing the dual role of CEO of Mercedes-Benz and president of the European Automobile Manufacturers' Association (ACEA), sent an open letter to the European authorities. Its main argument: potential fines deprive the industry of crucial resources for the development of more affordable electric cars.

The European market for electric cars experienced a slowdown with a 6% drop in registrations in 2023, unlike the growing American and Chinese markets. This worrying situation pushes manufacturers to request more flexibility in the application of standards.

Expert analysis: unfounded fears?

The Transport & Environment (T&E) organization sheds different light on the situation. According to their analyses, the majority of manufacturers should avoid fines thanks to several factors:

Outlook for 2025

S&P Global Mobility analysts predict a 40% increase in electric vehicle sales in Europe for 2025. This optimistic projection suggests that manufacturers will have the necessary means to achieve their emissions targets. Even in the worst-case scenario, T&E estimates that total penalties would remain below 1 billion eurosmainly focused on the Volkswagen group.

The example of the Volkswagen group illustrates the available options: with 17% of electric sales and a partnership with Tesla for the purchase of CO2 credits, the manufacturer could completely avoid fines. This percentage would rise to 22% for full compliance without credit purchases.

The debate over these regulations reflects the tensions between environmental ambitions and economic realities of the European automotive sector. The coming months will be decisive in observing the adaptation of manufacturers to these new regulatory constraints.

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