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Dirty he can: An off-road vehicle of the Fiat Chrysler brand Jeep in a river crossing
Maserati, Ferrari, Alfa Romeo – the Fiat Chrysler Group (FCA Show stock market chart) has some car brands in the program that stand for high-horsepower vehicles. These products have never been particularly economical or even low in emissions. But they provide them with automotive brilliance among the group’s mass-produced goods: the Chrysler limousines, the Fiat small and mid-size cars, the road-adventuring Jeep SUVs, and the martial Ram pick-up trucks.
However, FCA has a veritable engine problem with its volume brands: many of the engines Fiat, Chrysler and Jeep are using comparatively much CO2, Due to financial constraints, Fiat has invested less than the competition in the development of low-emission combustion engines or the electrification of its fleet. And that threatens to take revenge soon. From 2021, stricter fleet limits for CO2 emissions will apply in the EU. Fiat is loud an investigation by PA Consulting the auto company that is furthest away from meeting the stricter limits. As a result, the group is threatened with fines of billions.
How will get around with the help of Fiat Tesla to high fines
Now the Italian-American carmaker has found a legal but rather unattractive trick to avoid the impending fines. Fiat Chrysler will pay US electric car maker Tesla hundreds of millions of euros reported the business paper “Financial Times” (FT) at the weekend. In return, Fiat can include the CO2-free Tesla electric cars in its new-car fleet. Thus, the average CO2 emissions of the entire FCA new car fleet from 2021 will be below the limit set by the EU for the car manufacturer. In three years, according to EU rules, new cars may not emit more than 95 grams of CO2 per kilometer on average.
There are no official comments from FCA and Tesla. It’s a deal that works in a similar way to carbon trading: with the Tesla deal, FCA acquires, so to speak, pollution rights. This is probably cheaper and, above all, less burdening on the image than paying penalties. According to FT, without the 2021 deal, FCA could face up to $ 2 billion in punishment per year in the EU.
Legally, the pooling of car brands in the EU is allowed
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FCA is lagging behind in CO2 reduction efforts, according to a study by PA Consulting. According to this FCA must by 2021 manage to reduce the average CO2 emissions of its new vehicle fleet by 6.7 grams per kilometer. This is the largest distance to the target value among the 13 car companies studied in the study. Fiat Chrysler is – like other manufacturers – under pressure because of the stricter emissions regulations. Unlike some competitors FCA but hardly electric cars and hybrid cars on offer.
Legally, Fiat’s action is flawless. Under EU rules, car manufacturers can aggregate several brands when calculating the CO2 fleet value. Thus, for example, the small car brand Smart could computationally balance the CO2 emissions of heavy Mercedes vehicles. According to the EU, such pooling is also allowed between competitors’ car brands – but no automaker has dared to do so. FCA is now doing so, according to an application on the European Commission’s website. Accordingly, FCA has formed on February 25 together with Tesla a so-called “open pool”.
But there is still a second vehicle pool in the EU, reports the FT: Also, Toyota and the Japanese automaker Mazda have formed such a pool. There is, however, a significant difference to the FCA Tesla team: Toyota has a minority share of 5 percent in Mazda, the two Japanese automakers announced earlier months ago, a closer cooperation. FCA and Tesla, on the other hand, have not cooperated on any level so far – except for the CO2 indulgence trade.
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