Stellantis threatens to halt UK van production

STELLANTIS is threatening to stop vehicle production in the United Kingdom unless the British government does more to stimulate demand for battery-electric vehicles and help it comply with new electric vehicle mandates.

According to Stellantis UK managing director Maria Grazia Davino, a decision on the future of the company’s production in the region would likely come in less than a year.

Britain has introduced rules requiring that 22 per cent of each manufacturers’ new car sales be zero-emissions this year, rising to 80 per cent by the end of the decade. For vans – a staple of Stellantis’ UK production lines – 70 per cent of new vehicle sales must be electric by 2030.

But with demand for EVs slowing, Ms Davino said Stellantis would be forced to make discounts to meet the targets to avoid fines of as much as £15,000 ($A28,500) per unit for those failing to comply.

“There will be consequences (of the mandates),” she said. “Stellantis UK does not stop, but Stellantis production in the UK could stop.”

While there are UK tax incentives for corporate fleets to buy electric vehicles, there are no subsidies for consumers to buy EVs that are more expensive than their ICE powered equivilents.

Rather than pay the fines, Ms Davino suggested that Stellantis may choose to import fewer ICE powered models into the UK to curtail sales and reach the 22 per cent target.

“Rising targets through 2030 could be very damaging,” she added.

“If demand does not follow the offer, then we will be forced to take decisions – because we manage profit and loss, we manage operational decisions – that are impacting the UK.

“Let me be clear, I want to keep production in the UK.”

Stellantis sold almost 216,000 new vehicles in the UK last year, accounting for around 11 per cent of the total market – including more than 100,000 under the Vauxhall brand.

Ford of Europe has also said it will restrict sales of ICE powered vehicles in the UK rather than push EV sales to meet the mandate.

Like other automotive manufacturers, Stellantis wants Britain to provide tax incentives for consumers and bolster charging infrastructure, and for the company’s UK electric vehicle production to count towards its targets, even though some of it is exported.

Stellantis currently builds battery electric vans in the UK for is Citroen, Fiat, Opel, Peugeot, and Vauxhall brands, and will commence EV van production at its Luton plant from 2025.

With Automotive News Europe