Stellantis Might Shut Down Plants to Evade Severe EU Penalties | Carscoops

      The company has indicated it is facing the potential of fines amounting to $2.95 billion within the next two to three years.

      European automotive manufacturers have cautioned that they might be liable for fines nearing €15 billion in the near future.

      To comply with new regulations, Stellantis must increase its electric vehicle sales or reduce the production of internal combustion engine (ICE) vehicles.

      Jean-Philippe Imparato, the European chief of Stellantis, emphasized the risks associated with the Atessa van factory.

      Exciting developments are happening at Stellantis, particularly with Tim Kuniskis taking on a more significant role in the company and spearheading the resurgence of the SRT brand. However, the situation becomes more complex across the Atlantic. The auto giant might have to close several factories in Europe due to difficulties meeting regional CO2 emissions goals.

      Read: The EU Just Granted Automakers Exactly What They Requested

      As part of Europe’s comprehensive efforts to combat climate change, car manufacturers must stick to stringent emissions limits or face hefty financial penalties. Initially, fines were to be determined based solely on emissions from 2025. However, a legislative change introduced in May alleviated some of these penalties.

      Emissions will now be averaged over the 2025–2027 period, providing automakers with a longer timeframe to meet the established targets. Without this change, industry leaders warned that penalties could have surpassed €15 billion, equivalent to about $17 billion.

      Targets Still Out of Reach

      Despite the extended timeframe, Stellantis is in a challenging position. Jean-Philippe Imparato stated that the current targets remain unattainable for the company, and it is facing the possibility of fines up to €2.5 billion (approximately $2.95 billion) within the next two to three years.

      Next Steps

      During a recent conference at the Italian parliament, Imparato mentioned that Stellantis must either significantly increase EV sales across Europe or reduce production of its diesel and gasoline models, which would necessitate factory closures.

      “I have two options: either I push hard on electric vehicles… or I shut down internal combustion engine production. Consequently, I would have to close factories.”

      One facility already under examination is the Atessa plant in Italy, which might face downsizing or closure if the company shifts away from ICE production, according to a Reuters report.