In Stellantis Earnings Call, CEO Carlos Tavares stated that the newest iteration of the Euro 7 emission regulations with respect to nitrogen oxides and carbon monoxide are useless. EU regulators have been implementing various regulations over the years as concerns regarding air quality and climate change have been increasing. It aims to slowly tighten vehicle emissions requirements as part of the Union’s Euro Standard.
The most recent iteration of the regulations, Euro-7, is set to continue these gradual emissions tightenings, significantly limiting nitrogen oxide and carbon monoxide emissions from 2025 forward. However, as reported by Reuters, the Stellantis CEO believed these rules are useless. Regarding the new emissions rules, “It is not helpful, it is costly, it does not bring customers benefits, it does not bring environmental benefit. The ICE emission part is something which just makes no sense,” Tavares said during the company’s Earnings Call this morning. Tavares went on to note that the new rules regarding tire and brake particulate were far better inclusions in the new regulations.
But the Stellantis chief’s argument on why he believes these regulations to be “not helpful” is equally as interesting as his provocative statements. The Stellantis CEO notes that thanks to the EU’s ban on new ICE vehicles starting in 2035, these new emissions controls may prove moot as automakers shift to 100% electric offerings. Furthermore, he argues, by putting in place these new regulations, automakers are forced to invest more money into dying ICE vehicle platforms to ensure that they meet these new requirements, all while already investing in replacing them entirely.
Electrification
In concluding his statement to investors this morning on the European/American auto group’s earnings, Tavares noted that Stellantis was more dedicated to vehicle electrification than ever and is pursuing new electric models as quickly as possible. While many Stellantis brands lag behind competitors in terms of current electric offerings, all of them are now working to introduce more electric models.
Stellantis truck brand RAM plans to introduce its first electric pickup, the RAM 1500 REV, in the next two years. Jeep, Stellantis’ famed offroad brand, has launched its first EV in Europe and plans to introduce its first full EV in North America shortly. Meanwhile, European Stellantis brands Peugeot, Citroen, and even Maserati have introduced their first EVs with varying degrees of success. As major automakers and auto groups like Stellantis continue to electrify, Carlos Tavares is likely correct that regulations will be forced to change to ensure ever-improving safety and environmental footprints. It remains to be seen what that regulatory system will look like and what materials or externalities will be regulated for.
