The European car industry is bracing for significant financial strain as the European Commission's new emissions regulations approach. Starting January 2025, automakers must limit average emissions to 93.6 grams of CO2 per kilometer across the vehicles they sell. Non-compliance will result in hefty fines, which the European Automobile Manufacturers Association (ACEA) estimates could total €15 billion industry-wide.
ACEA President Luca de Meo, speaking in Brussels, warned that these fines would redirect critical funds away from green technology investments. "We need flexibility," said de Meo, emphasizing that while the industry is committed to electrification, achieving the interim targets set years ago remains a challenge. He pointed to insufficient charging infrastructure, tepid consumer demand, and delays in transitioning to electric vehicles as significant barriers.
De Meo, also Renault’s CEO, highlighted the urgency for Europe to learn from the success of Chinese manufacturers, who are advancing rapidly in the electric vehicle market. While acknowledging the competitive threat, de Meo proposed strategic partnerships with Chinese firms to accelerate Europe’s industrial transformation. An example of such collaboration is the joint venture between Stellantis and China's CATL to build a €4.1 billion battery plant in Zaragoza, Spain.
Regulatory simplification is another key demand from the industry. According to de Meo, the regulatory burden accounts for 40% of a vehicle’s cost, underscoring the need for streamlined rules to ease production costs.
The industry’s recovery also hinges on the broader economic outlook in Europe. Vehicle sales have not returned to pre-pandemic levels, and many Europeans are opting for second-hand cars due to affordability concerns. "Europe is the only region where the market has not rebounded to pre-COVID levels," de Meo remarked, calling for measures to support consumer purchasing power.
