Japanese automaker Mazda has teamed up with its joint venture with China’s Changan to pool carbon credits and help avoid carbon emissions fines, an EU document showed.
EU’s fines, which carmakers have said could total up to 15 billion euros ($17.5 billion) for the industry, were initially envisaged to apply to 2025 carbon emissions levels.
However, in March, the European Commission bowed to pressure from car manufacturers and allowed compliance based on their average emissions over 2025-2027.
The idea is to force car makers to sell more EVs. So the EU has put up fleet emission targets for car makers. They are currently so low, that you need to have zero emissions vehicles as part of the fleet, as hybrids do not cut it. However the EU allows for trading of credits, which allow car makers with lower fleet emissions to sell credits to car makers with higher emissions.
The key part is, that you can track EU EV sales fairly well, by running some math on how many EVs are needed to meet those fleet targets. So that law is actually working. The other part is the 2035 combustion engine phase out.