Article originally in the Financial Times.
Again, car manufacturers focus on new hybrids and modernized cars with a gasoline engine, as their managers are trying to strengthen profits during expensive waiting for electric vehicles to become a common matter.
General Motors, Porsche, BMW and Mercedes-Benz have promised to invest in new or modernized internal combustion models and hybrid models even at a time when they increase the number of electric vehicles to meet stricter emission regulations in Europe and elsewhere.
Automakers doubt and re -evaluate
According to S&P Global Mobility, this year is expected to increase new models of vehicles with internal combustion engine and hybrid vehicles by nine percent compared to 2024. In 2024, while putting hybrid vehicles on the market will increase by 43 percent to 116 the model.
Last week, Mercedes-Benz revealed plans to the market from 2025 to 2027 on the market of 19 petrol vehicles and 17 battery electric vehicles after sales and profit margins were reduced as a result of a slowdown in demand for electric vehicles.
“If you do not believe that in 2030 electric vehicles will prevail on the market … There would be no economic sense to simply cut off their very healthy and profitable business with an internal combustion car,” said Ola Källenius chief investors.
Porsche, which recorded a 49 % decline in the sale of its electric sedan Taycan last year, also doubts its electric vehicle strategy. This month, a luxury car manufacturer announced that it will rewrite its future model range and invests € 800 million in the development of new vehicles with an internal combustion engine and hybrid vehicles.
BMW asks to abolish a European prohibition
Traditional car manufacturers must cope with the cost of investing in future electric and hybrid vehicles while maintaining the internal combustion engine technology longer than expected.
Hybrids that combine batteries with an internal combustion engine are highly profitable and attractive to car manufacturers in connection with the increasing demand of consumers and the need to reduce emissions. EU rules for 2025 require each car manufacturer to reduce its total emissions by 15 percent compared to the reference year 2021.
Brussels is also going to ban the sale of new gasoline and diesel cars since 2035. Car manufacturers are asking for flexible rules on emissions and banning internal combustion engines in 2035, BMW even calls for cancellation.
In recent weeks of Volvo Cars, Mercedes-Benz and Renault, this year has been foregoing lower profits on the risks arising from the Global Customs War, as well as the cost of meeting stricter emission standards. It is therefore even more difficult to say goodbye to higher profits from gasoline and hybrid vehicles.
It will take 20 years
“In the area of electric vehicles, we proceed quickly, but we will not slow down even in vehicles with an internal combustion engine,” said Renault chief Luca de Meo. “The way to be the dominant technology in Europe will take 20 years.”
While the growth of electric vehicles has slowed in Europe, demand increased sharply in China, where, according to the Shanghai company, electric and hybrid vehicles were 47 percent of sales last year. Five years ago it was only six percent.
The production of electric vehicles is more expensive than the production of gasoline vehicles due to high battery costs, which means that car manufacturers are still reaching for electric vehicles below profit margins.
Mercedes-Benz Financial Director Harald Wilhelm said that the group reduces the cost of electric vehicles by more than 15 percent. This would reduce the cost difference compared to cars with the internal combustion engine, but Wilhelm added that in terms of reducing the difference, “we do not want to promise things that we cannot do”.
It would be stupid to stop selling cars on gasoline
The largest European car manufacturer Volkswagen is no longer sure of its plan to stop selling petrol cars in Europe by 2033, says one person familiar with discussions. “It would be stupid [prestať predávať autá so spaľovacím motorom]if our customers want them, ”the source said.
General Motors also modernize its internal combustion models. Although its share in the sale of electric vehicles in the United States last year increased from six to nine percent due to the demand for the fully electric Chevrolet Equinox, its managers warned that the growth of the overall market is likely to slow down after US President Donald Trump signaled the end of consumer subsidies for electrical subsidies for electrical subsidies cars.
“I think there may be a scenario in which the profitability of vehicles with an internal combustion engine and cash flow can continue longer than that of the other case,” said GM Paul Jacobson, financial director at Barclays conference last week.
More messages were provided by Ian Johnston in Paris
© The Financial Times Limited 2025.All rights reserved. It must not be further spread, copied or modified. Ringier Slovakia Media is responsible for providing this translation. The Financial Times Limited is not responsible for the accuracy or quality of the translation.
