Stellantis Warns EU Fines Could Force Factory Closures

Stellantis might be forced to shut down some of its factories across Europe if strict emissions rules and heavy carbon fines from the European Union (EU) aren’t adjusted soon. That was the message from Jean-Philippe Imparato, Stellantis’ Chief Operating Officer for Enlarged Europe, during a recent conference in Rome, according to Reuters.

The automaker is facing potential penalties of up to €2.5 billion (approximately $2.95 billion USD) over the next few years. The issue? The EU is requiring all automakers to significantly reduce their fleetwide CO₂ emissions between 2025 and 2027, or face penalties.

Imparato said Stellantis has only two real options to avoid those fines: either dramatically increase electric vehicle (EV) sales or cut production of gasoline and diesel-powered vehicles. However, with EV demand still shaky and affordability an issue in many countries, he said, doubling EV sales is just not realistic. That leaves one difficult path: shutting down internal combustion engine (ICE) vehicle plants.

“I have two solutions: either I push like hell (on electric) … or I close down ICE (internal combustion engine vehicles),” Imparato said at the Italian parliamentary conference. “And therefore I close down factories,” he added, even citing the Atessa van plant in Italy as an example that could be at risk.

This situation is putting Stellantis—and other automakers—in a tough spot. While the industry successfully lobbied to extend the EU’s emissions compliance timeline, so that fines apply across 2025–2027 rather than just in 2025, companies are still feeling the pressure. It’s a tight squeeze: if they continue to produce too many gas and diesel vehicles, the fines increase. But if they shift too fast to EVs, they risk building cars that customers can’t or won’t buy yet.

Imparato said the industry needs clarity and adjustments by the end of this year to avoid drastic decisions.

As the deadline inches closer, Stellantis is sounding the alarm. The company’s message is clear: without regulatory help or a faster EV market shift, hard choices are coming.

Source: Reuters