'My guys are ready for the fight' on EU CO2 targets, Stellantis CEO Carlos Tavares says

TURIN -- European automakers, including the ACEA industry group, have called for a delay in the EU’s 2025 emissions standards, citing slowing demand for EVs. But Stellantis is not one of them, CEO Carlos Tavares says, because it is ready to compete after years of preparing for the new rules.

"The rules have been known for several years," he said. "My guys are ready for the fight."

The 2025 CO2 target for Europe's new-car fleet will be at least 15 percent below the current regulations, meaning that automakers may have to double their sales of zero-emission battery-electric cars to avoid paying fines. However, the EV market has flattened this year after reaching about 14 percent in Europe in 2023, and some governments have pulled back on once-generous EV incentives.

"Now, we are a few months before the race starts, and somebody says, hold on, change the rules," Tavares told journalists in Turin on Sept. 17. Even if there is a delay in the standards, he said, "the global warming issue is still here." 

Tavares said that automakers who are seeking a delay may be fearful of losing money, because the profit margin on EVs is less than on internal-combustion models, and costs are higher.

Earlier in the year, Tavares said the rush to offer low-cost EVs could lead to a "bloodbath" among automakers. 

"What companies are telling you is that if they double their BEV sales, not making money with those cars, they are going to put themselves in trouble," he said.

Renault CEO Luca de Meo, who is also the president of ACEA, said this month that companies risked incurring total EU penalties of €15 billion in 2025 – or cutting back production by 2.5 million cars.

"Everyone is talking about 2035, in 10 years [when the EU’s zero-emission mandate takes effect]," de Meo said, "but we should be talking about 2025 because we are already struggling."

"We need to be given a little flexibility," he added.

VW Group CEO Oliver Blume has called for the 2025 target to be adjusted.  "It doesn't make sense that the industry has to pay penalties when the framework conditions for the EV ramp up aren't in place," he told investors in March.

'Difficult decisions'

With the pullback of government incentives in countries including Germany and France, Tavares said, "We are back to Square 1, which is how to sell BEVs at the price of ICEs, profitably."

Stellantis has been working to cut costs on EVs for years, he said, a task he described as involving many "difficult decisions." 

"Consumers are telling us that they want to buy electric vehicles at the price of internal-combustion engine vehicles," he said. "But today there is no business case that supports that."

Stellantis is ready for the 2025 emissions targets, he said, because it is launching a range of low-cost EVs from Citroen, Opel and Fiat on the group’s Smart Car platform.

"We are leading the pack because we are bringing BEVs like the Citroen e-C3 [small hatchback] from €20,000 euros," he said. Small SUVs from Opel and Citroen will be less tham €30,000.

"My technology is ready, my cars are ready. My plans are ready," he said. "The rules are known. The competition is going to start."