Stellantis, the parent company of Vauxhall, Fiat, Citroen, and Peugeot, will decide the fate of its UK factories within weeks amid a standoff with the Government over the terms of electric vehicle (EV) sales.
In June, Stellantis warned it may have to close its Ellesmere Port and Luton plants unless ministers consider regulations requiring a certain percentage of EV sales. These facilities, which produce electric cars, vans, and employ more than 1,000 workers, are at risk as the company pushes for changes to the Zero Emission Vehicle (ZEV) directive.
The ZEV mandate, introduced this year, requires 22% of vehicles sold by manufacturers to be electric, a number that will increase every year until 2030. Companies that fail to meet these targets face a £15,000 fine for each non-compliant vehicle or have to trade in carbon credits. and competitors.
Stellantis CEO Carlos Tavares warned that current regulations force manufacturers to sell more EVs than consumers want, leading to price cuts necessary to stimulate sales. Tavares emphasized the need for government support to boost consumer demand during a recent Bloomberg interview, noting that a decision on the future of the crop will be made soon.
The challenge for automakers comes as EV sales grew 25% to a record 56,362 in September, but due to demand from motorists rather than private buyers. Despite heavy discounts, private EV sales increased by only 3.7% year-on-year, indicating the need for more incentives to make EVs more attractive to individual consumers.