Stellantis, formerly Fiat Chrysler Automobiles, says it won’t need to buy credits from Tesla to meet emissions targets

Stellantis
Image via Mashable

Tesla has made a lot of money from selling regulatory credits to legacy automakers who have failed to meet their emissions targets. In the automaker’s Q1 2021 financials, that number amounted to $518 million, a 46% increase year-over-year (YoY).

One of those automaker buying those credits from Tesla is Stellantis, which was previous Fiat Chrysler Automobiles (FCA) before a merger with Peugeot S.A. (PSA) last year. In 2019 FCA inked a $2 billion deal to purchase U.S. and European credits from Tesla through 2021 to help avoid paying massive fines.

Thanks to the merger with PSA and the addition of high-volume electric vehicles (EVs) from Renault and Peugeot, Stellantis CEO Carlos Tavares believes they will no longer have to buy credits from Tesla.

“With the electrical technology that PSA brought to Stellantis, we will autonomously meet carbon dioxide emission regulations as early as this year. Thus, we will not need to call on European CO2 credits and FCA will no longer have to pool with Tesla or anyone.

As a result of the combination of Groupe PSA and FCA, Stellantis will be in a position to achieve CO2 targets in Europe for 2021 without open passenger car pooling arrangements with other automakers,” Tavares said in an interview with French weekly Le Point (via Reuters).

If Stellantis is able to meet their targets and not have to purchase credits, this revenue source will not hit zero. Tesla has typically been tight-lipped about who their customers are, but we know Honda agreed to a similar deal last year. The financial terms of that deal were not disclosed.

The European Commission is meeting later this year to determine the next round of tightening regulations. Final numbers have not been decided upon, but the 2030 target could be lowered to less than 43 grams/km. It is currently at 95 grams/km.

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