Stellantis to Keep Buying Tesla CO2 Credits Despite EU Compliance Delay

Stellantis (NYSE: STLA), Europe’s second-largest automaker, will continue purchasing carbon credits from a pool led by Tesla (NASDAQ: TSLA) in 2025 to meet the EU's CO2 emissions targets, even after the European Commission offered a more lenient compliance timeline. Jean-Philippe Imparato, Stellantis’ head of European operations, confirmed the move at an automotive event in Turin, emphasizing the company’s commitment to using "everything" available to meet regulatory demands.

Under the European Union's stricter emissions rules, automakers must reduce average fleet CO2 output or face steep fines. Companies with lower electric vehicle (EV) adoption, such as Stellantis, often join emissions credit pools led by EV frontrunners like Tesla and Polestar (NASDAQ: PSNY). These pools help balance overall emissions, ensuring compliance across participants.

Although the European Commission recently agreed to average emission targets over a three-year period (2025–2027), rather than strict compliance in 2025 alone, Stellantis remains cautious. Imparato acknowledged the extension offers "breathing space," but warned it does not resolve the company’s challenges.

Currently, Stellantis’ EVs account for just 14% of its European sales, falling short of the EU’s 21% benchmark. To help bridge the gap, Stellantis plans to ramp up production of a new hybrid Fiat 500. Production will begin in November at the company’s Mirafiori plant in Turin, targeting 130,000 units annually across hybrid and EV models.

The strategic reliance on carbon credit pools underscores the pressure traditional carmakers face in the transition to electrification, as well as the growing influence of Tesla in Europe’s regulatory landscape. Stellantis’ ongoing participation highlights how legacy automakers are leveraging EV leaders to navigate emissions regulations while accelerating their own electrification efforts.