Interview: EU automakers frustrated with unclear emissions plans

Let's focus on Europe and the issue of regulations. The automotive industry's current key phrase is "CO2 emissions."

Lynn Calder, CEO of Ineos Automotive: Yes, it’s definitely a huge challenge for the entire industry. As a new brand, it’s somewhat easier for us because we don't have the "baggage" of 100 years of history. We entered the market when changes were already underway. But even for a small manufacturer like us, balancing regulations with customer preferences is critical.

Introducing a new car to the market involves a significant investment that must pay off. Meanwhile, there’s still no clarity on the direction of market development. Governments in the United Kingdom and the European Union aim to reduce emissions but have no detailed plan on how to achieve this. This is the biggest challenge and disappointment for us.

Of course, I will do what's necessary to adapt the company to regulations and achieve net zero emissions. But we need a clearly defined plan on what is possible and what isn't. Just because governments want us to be 100% electric by 2035 doesn’t mean it will happen, especially when many drivers simply do not want electric cars.

2035 is the year when the ban on the sale of combustion engine cars is supposed to take effect. Some brands have announced they will be 100% electric by 2030. Now, some are softening their rhetoric and even taking a step back. From your words, it seems Ineos does not intend to lead the race to zero emissions.

No, we do not intend to, and we never said we would. We entered the market with gasoline and diesel cars. In our opinion, there will always be a market for the Grenadier with a combustion engine. While there may be a ban in the European Union, we will be in at least 50 countries worldwide, each with different ideas.

Not all drivers want to drive electric cars. They’re more expensive, don’t retain residual value, and primarily, there's no developed charging infrastructure. Consumers are still concerned about range issues. While some of the market is already buying and satisfied with electric cars, many are not interested. What will we offer them?

Indeed, some brands are backtracking on their original declarations. The EU announced regulations, and manufacturers worked hard to comply, but both sides overlooked what drivers need daily. People need choices. That’s why we announced our next model would be electric but with a range extender, a small engine that recharges the batteries, eliminating range anxiety. This kind of car drives like one with a conventional engine but with much lower emissions.

If governments ban even such solutions, I don't know what we will do. Politicians should allow for transitional technologies. It would be better for the environment than trying to switch 100% to electric and failing. Because I believe we will fail.

What do you think is the solution for 2035 in the European Union?

A mix of drive systems. We need to leverage the potential of hybrids, plug-in hybrids, and range extenders to reduce CO2 emissions in various ways. I’m convinced it’s more reasonable than striving solely for electric cars because that will undoubtedly fail. Consumers might be encouraged to buy electric cars, but without investments in infrastructure, they simply won't. They’ll keep conventional vehicles longer and purchase older used ones, leading to a step backward.

If Ursula von der Leyen were talking to you instead of me, what would you tell her?

Please clearly define the plan and do not ban transitional technologies. Also, invest in developing infrastructure.

There are voices that various incentives and subsidies aren't enough to get drivers to switch to electric cars. Do you think it's time for "the stick" instead of "the carrot"?

I don't believe in the effectiveness of incentives, but I understand their necessity. The government expects consumers to stop driving combustion cars and switch to electric ones, which are more expensive to buy and potentially more expensive to operate based on the source of electric energy. The government must offer something in return. It can't just introduce a regulation and expect compliance without support.

Conversely, if something is only economically viable with short-term incentives, it won't work long-term. Within the EU alone, there are different views on the same issue. Take the tax on owning a combustion engine car. If it works by discouraging ownership, governments might tax electric cars in the future to avoid losing revenue.

Ineos produces off-road vehicles at a time when SUVs are under scrutiny. For instance, in France, a referendum supported higher parking fees for large cars. Will Europe turn away from SUVs?

We already see some signs of this. However, most cars are getting bigger in size and weight, partly due to batteries or shared platforms used by auto companies. Even "small cars" today are bigger.

France is a special case with significant taxes on SUVs with combustion engines. This market is being limited, but the world is vast, and there are many countries where this type of car will be needed for many decades.