Still noticeable
Last year, car manufacturers were given more time to bring their average CO2 emissions down to the level desired by the EU. This is good news for many of them, but less favorable for car manufacturers who are on the receiving end of so-called CO2 pools.
The average CO2 emissions per car sold in the EU have been set at 93.6 grams per kilometer for the years 2025 to 2029. Nothing changed a year ago, but car manufacturers were given more leeway then. Instead of an annual average starting in 2025, they can now calculate this target over the period 2025 to 2027 as a whole. Whoever achieves the average over those three years is fine.
Achieving these CO2 targets is easy for one car manufacturer and a bit less so for another. That’s why car builders are allowed to help each other. They form so-called CO2 pools, where poorly performing manufacturers buy ‘CO2 credit’ from well-performing manufacturers for a considerable amount, and all involved car builders together remain neatly below the norm.
Last year, the easing of the calculation method seemed to have no major effect on those CO2 pools, but according to Automotive News, that is starting to change. While the revenue stream last year – before the announcement of the easing – immediately generated a serious income for, among others, Tesla and Volvo, there is now much less demand from these large-scale EV sellers. “It seems that the value of those CO2 credits is doubtful this year,” confirms Volvo CEO Hakan Samuelsson.
Mazda
Automotive News also inquired about emissions credits with Martijn ten Brink, director of Mazda Europe. Mazda has so far definitely been a car manufacturer that has some compensating to do, but Ten Brink frankly admits that the urgency is now gone. “For 2026, we will decide what to do after the first quarter. We have to wait and see what the demand for electric cars will be exactly this year.” With a fresh Mazda 6e in the showroom and a higher CX-6e on the way, that position is absolutely defensible.
For Volvo and Tesla, the decline of the pooling phenomenon means a significant loss of income. Tesla still earned $1.99 billion from this in 2025, more than from lease constructions, for example. This was worldwide, so possibly outside Europe as well. For Volvo, CO2 credits generated 329 million euros in 2025. Both manufacturers had already taken into account declining revenues in this area. In Tesla’s annual report, the CO2 credit is even deducted separately from revenue to give a more realistic picture of what was actually earned.