How Tesla Makes Money From Its Competitors

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

New, tougher emissions regulations have officially come into effect in Europe, and many automakers are scrambling to figure out how to deal with them. In short, each company must adhere to a certain emissions level based on the total number of vehicles sold. Accordingly, about 20% of new car sales must be electric. And many automakers are having trouble meeting that level.

The product portfolio must have a certain proportion of hybrid or electric vehicles to meet the new EU emission regulations (Illustration photo: Toyota).

In Europe, automakers can band together to meet emissions standards. A company with a portfolio of electric vehicles that easily meets emissions standards can offset a brand that doesn’t, and Tesla is the “overqualified” case.

With an all-electric product line and strong sales in the European market, Tesla is well-positioned to meet the new emissions regulations. As a result, most major automakers, including Ford, Stellantis, Mazda, Subaru, and even Toyota, are teaming up with Tesla to meet emissions standards.

With 2025 just over a week away, companies have plenty of time to decide whether to team up with other brands. According to Automotive News Europe , teaming up now may not be a safe bet for some brands, given that they could end up falling short of the benchmark by the end of the year. Others may know they won’t meet the required benchmark and are bracing for fines.

For every gram of emissions that exceeds the limit, car companies will be fined $105 (about 2.6 million VND), and the fines can increase rapidly. Depending on how much a company exceeds the limit, paying Tesla to average out its emissions may be cheaper. Analysts estimate that Tesla could pocket $1 billion by the end of this year thanks to this type of regulatory loophole.

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