Ola Källenius, Mercedes-Benz CEO and president of the European Automobile Manufacturers Assn. (ACEA), says Europe’s new-car sales will hit a “wall” if the European Union does not reconsider its proposed ban on internal-combustion-engine vehicles from 2035.
In an interview with German newspaper Handelsblatt, the automaker boss says a better approach would be to boost the uptake of battery-electric vehicles through lower electricity prices, particularly for public charging stations, as well as tax incentives.
“We need to do a reality check,” he tells the newspaper in an article published on its website, adding that if the ban goes ahead as scheduled “…we'll drive full speed into the wall.”
Källenius warns that the ban would seriously weaken Europe’s domestic automotive industry and see a spike in consumers buying ICE-powered vehicles before the ban, saying, “That doesn't do the climate any good.”
He says unattainable mandated sales targets of zero-emission vehicles, coupled with U.S. vehicle import tariffs and rising competition from cheaper Chinese products, are slashing domestic automakers’ profit forecasts.
For Mercedes-Benz, that means a move away from expensive luxury vehicles as it chases volume, a strategy seen as controversial among employees and customers alike.
“Our industry is experiencing heavy rain, hail, storms and snow at the same time. Car manufacturing is a tough business, more so than ever,” says Källenius.
However, he admits the company’s offerings of affordable BEVs in the midrange price sector has been inadequate.
The company is attempting to address this issue with the launches of the electric GLC and the electric C-Class. “With this, we're going on the offensive,” Källenius notes.
