Renault Warns BEV Slowdown Sparks Billions in Fines for Automakers

Renault boss Luca de Meo tells a radio show that European automakers could face up to €15 billion ($17.4 billion) in fines for carbon emissions due to the slowing uptake of battery-electric vehicles.

His comments made on the France Inter radio station follow warnings from Cupra’s CEO Wayne Griffiths that his brand could be “wiped out” by the punitive fines following tariffs on Chinese-made BEVs.

However, these fines would come from automakers facing tougher European Union CO2 targets in 2025, with the cap on average emissions from new vehicles falling to 94 grams/km from 116 g/km in 2024, reports Reuters.

Exceeding CO2 limits would see the imposition of fines amounting to €95 ($105.3) per excess CO2 g/km multiplied by the number of vehicles sold, resulting in automakers being hit with billions in penalties.

Exponents of a multi-energy approach to powertrains would point out the tailpipe targets for CO2 do not tell the whole story of a vehicle's CO2 emissions throughout its lifecycle. According to an Emissions Analytics study, Environmental Justice, the average annual mileage of European motorists could see outright automotive industry CO2 emissions rise if all consumers were forced into BEVs.

That's because the average mileage driven by European motorists is just 7,000 miles (11,270 km). However, most (53.6%) of the continent's private passenger fleet do not travel more than 5,000 miles (8,050 km) annually.

This, together with the average electricity-generating mix between fossil fuels and sustainable sources, means these vehicles will not repay the extra CO2 emitted during production, compared to an internal-combustion-engine vehicle, within the standard BEV warranty period of eight years, thus raising CO2 emissions overall.

Speaking on the radio show, de Meo, who is also the current president of the European Automobile Manufacturers Assn., says: “If electric vehicles remain at today's level, the European industry may have to pay €15 billion in fines or give up the production of more than 2.5 million vehicles.

“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. Everyone is talking about 2035, in 10 years, but we should be talking about 2025 because we are already struggling. We need to be given a little flexibility. Setting deadlines and fines without being able to make that more flexible is very, very dangerous.”