Fiat Chrysler Will Pay Tesla To Dodge Billions In Emissions Fines (theverge.com)

MDMurphy writes: While people have good and bad things to say about Tesla, one consistent thing has been that the cars emit zero emissions when operating. But in Europe, in exchange for cash, Tesla is merging its fleet with that of Fiat Chrysler Automobiles (FCA). The amount FCA is paying Tesla is presumably less than they would in fines if they were on their own. With this merging of the fleets, in Europe at least, a Tesla is no more clean than a diesel Fiat. "The Italian-American carmaker is behind on meeting the new standard, and the so-called open pool option available at the EU allows automakers to group their fleets together to meet the targets," reports Bloomberg. "Payments to Tesla, whose electric cars don't produce CO2 emissions, may amount to over 500 million euros, according to Jefferies."

Ars Technica reports on the strict new EU regulations: "From 2020, 95 percent of an automaker's new cars sold in the EU have to meet this target, with the remaining 5 percent falling under the law in 2021. And the penalties for failing are draconian: a $107 'excess emissions premium' per gram of CO2 over the target, for every single car registered in the EU that year. For some OEMs, this has the potential to be ruinous; if FCA's portfolio were the same in 2021 as it was in 2018, the automaker would have to pay some $3.12 billion, out of total net global profits of $4.1 billion."

Comments

Now you see the true power of the Tesla

[SuperKendall]

So, with Tesla being the only automaker who can realistically deliver cars and charging stations for fleets around the globe needing to meet standards in this way, perhaps it starts to become clear just how incredibly valuable Tesla is becoming...

Re: Now you see the true power of the Tesla

[Askmum]

1: the legislation in the EU is that the average pollution of the cars a car manufacturer sell can not be more than a certain level. In 2018 118,5 gram CO2 / km, in 2021 95 gram CO2 / km. I'm not going into a dicsussion if the law is ok or not, but it is a law. So the reduction will happen. This is all a matter of averages, a car manucaturer can still sell high-powered, high-polluting cars like a Lamborghini Aventador when they offset that pollution by selling eco-friendly cars like a e-up! (Lamborgini and VW belong to the same company, VAG).
Since this is a matter of averages, the EU has allowed manufacturers to engage in pools to offset their pollution against a company that produces cars with less pollution. One example of this pool is Mazda and Toyota. Another is now FCA (Fiat/Chrysler), Alfa Romeo and Tesla. The alternative for FCA was either to pay hefty fines to the EU (going into the billions of euros) or stop selling those polluting cars alltogether (which in this case would be most likely Maseratis, Jeeps and Dodge RAMs). This way they can still sell those cars, pay less of a penalty, help a manufacturer that does do what the EU wants and have more money left to invest in their own portfolio to compy with legislation.

2: In what way is Tesla not a succesful company.

3: typical AC comment. You may not agree with the law (and I am no fan of the EU) but this is what it is.

Re:So what in the world was accomplished?

[vux984]

" So what in the world was accomplished? "

Two things actually:

1) We got to see corporate lobbying in action. They effectively got themselves a loophole that would let them reduce their fines by 70% or whatever.

2) Even so, an electric car company got a big cash infusion paid for by a big polluter; helping increase the competitiveness of Tesla at the expense of Fiat.

It's effectively subsidizing electric car research, development and production, paid for by fiat ... which really means it's paid for by the people who chose to buy chryslers and fiats.

It also seems like this, at least, is precisely the desired outcome.