How Tesla makes money from its competitors.

(Dan Tri Newspaper) - Tesla could earn $1 billion from competitors when new emissions regulations take effect in Europe.

Stricter emissions regulations in Europe have officially come into effect, and many automakers are scrambling to find ways to comply. In short, each company must adhere to certain emissions levels based on the total number of vehicles sold. Accordingly, around 20% of new vehicle sales must be electric. And many automakers are struggling to meet this target.

A product lineup must include a certain percentage of hybrid or electric vehicles to meet the EU's new emissions regulations (Illustrative image: Toyota).

In Europe, automakers can band together to meet emissions standards. A company with a product portfolio that includes many electric vehicles, easily meeting emissions standards, can offset the needs of a brand that doesn't, and Tesla is a prime example of this "over-meeting" situation.

With a product line consisting solely of electric vehicles and strong sales in the European market, Tesla is more than capable of meeting the new emissions regulations. Therefore, most major automakers, such as Ford, Stellantis, Mazda, Subaru, and even Toyota, are partnering with Tesla to achieve emissions standards.

With 2025 just over a week into the year, companies have plenty of time to determine whether or not to partner with other brands. According to Automotive News Europe , partnering now might not be a safe option for some brands, as they could fall short of their quotas by the end of the year. Others may know they won't meet the required quotas and are preparing for penalties.

For every gram of emissions exceeding the permitted limit, the automotive company will be fined $105 (approximately 2.6 million VND), and the fine can increase rapidly. Depending on a company's extent of exceeding the limit, paying Tesla to average emissions could be cheaper. Analysts estimate that Tesla could pocket $1 billion by the end of this year thanks to this loophole.

Source: https://dantri.com.vn/o-to-xe-may/cach-tesla-kiem-tien-tu-chinh-cac-doi-thu-canh-tranh-20250110171314412.htm