UK (Commonwealth) _ Due to regulations governing the production of electric vehicles (EVs), Stellantis, the manufacturer of Peugeot, Citroën, Vauxhall, and Fiat automobiles, has threatened to stop producing cars in the UK.
At a Tuesday industry event, Stellantis’ managing director, Maria Grazia Davino, stated, “Stellantis production in the UK could stop.” The company has stated that starting in 2025, it would begin producing electric vehicles in Luton, Bedfordshire, in addition to Ellesmere Port, Cheshire.
But according to Ms. Grazia Davino, more work has to be done to increase consumer demand for EVs. In the event that fewer electric vehicles are purchased, manufacturers may be in violation of UK laws. Fully electric vehicles, as opposed to hybrids, are required by UK legislation to account for 22% of all automakers’ sales.
According to the most recent Society of Motor Manufacturers and Traders (SMMT) figures, just 16% of sales are electric vehicles at the moment. Ms. Grazia Davino stated, “The fact is that there is not a demand.” However, manufacturers risk fines of £15,000 for each every non-electric vehicle.
This is more burdensome than regulations from the European Union that permit both EVs and hybrids to be included in CO2 emissions reduction goals.
In “less than a year,” Stellantis will decide whether to continue producing in the UK or not, according to Ms. Grazia Davino. “Let me be clear, I want to keep the production in the UK,” she stated.
China’s EV output is causing tensions to escalate. Like other automakers, Stellantis is looking for financial incentives to persuade customers to purchase electric vehicles and make investments in the infrastructure necessary for charging them rather than fossil fuel-powered vehicles.
Businesses purchasing EVs can benefit from tax breaks, but consumers are not now eligible for any incentives. An electric vehicle (EV) costs more up front than a conventional car fuelled by gasoline or diesel.
Stellantis also wants its manufactured automobiles to be included in the 22% goal. According to Ms. Grazia Davino, in order to reach the goal, Stellantis may decide to reduce sales by bringing in fewer fossil fuel-powered vehicles into the UK.
This is the company’s second attack on federal policy in as many months. Carlos Tavares, the CEO of Stellantis, stated in April that the ZEV (zero emission vehicle) regulation encourages the industry’s self-destruction. I’m not going to lose money on auto sales. Something needs to happen if the UK is serious about maintaining and defending its industrial sector.”
Stellantis’ UK business might be negatively impacted by the government’s present strategy of prohibiting gasoline and diesel vehicles, according to CEO Maria Grazia Davino. It may be decided in “less than a year” whether to close Stellantis’ operations in Luton and Ellesmere Port, which is close to Liverpool, she added.
“Stellantis UK does not cease, but Stellantis production in the UK may cease,” she stated to reporters on Tuesday during an industry gathering. Other well-known auto brands owned by Stellantis include Fiat, Jeep, Alfa Romeo, Chrysler, Dodge, Maserati, and Opel.
The UK government postponed its intention to outlaw new gasoline and diesel car sales by five years in order to allow customers more time to switch to electric vehicles. The original deadline was set for 2030.
The prime minister gave an explanation for the decision, stating that EVs’ “upfront cost” was still too high. In addition to producing electric vans at its Ellesmere Port facility, Stellantis has previously stated that it will begin producing electric vans at its Luton facility in 2025.
Speaking with reporters, Ms. Davino stated: “We have made significant investments in Luton and Ellesmere Port, and we plan to make more.” “But we will submit an evaluation to produce elsewhere if this market turns against us.”
Her remarks come after a protracted battle between automakers and the government over the transition to electric vehicles, the demand for which has lately decreased. The threat of low-cost Chinese electric vehicles has increased manufacturers’ concerns about forgoing too much profit in the face of a sluggish market.
It implies that in order to drive a nonexistent market, you must raise discounts. Additionally, there are other ramifications for the business case, according to Ms. Davino. Policies to lower emissions and improve air quality are offered by both the Labour and Conservative parties.
In the meanwhile, the EU has threatened to levy extremely high levies on Chinese imports, claiming that the Chinese government improperly subsidized electric vehicles (EVs).
