Tesla could be set for a $1 billion windfall in Europe after rivals fail to sell enough EVs

Electric Vehicle Emissions Pooling - Carmakers lagging behind on electric vehicle sales can pool with rivals to average out emissions, effectively buying carbon credits from EV leaders like Tesla [1] - Toyota, Ford, Stellantis, and Mazda have pooled with Tesla, while Mercedes-Benz formed a separate pool with Volvo and Polestar [1] Tesla's Regulatory Credits Business - Tesla's total compensation for selling credits to pooled rivals could exceed $1 billion, with Volvo and Polestar potentially banking $300 million [4] - Tesla made $739 million from selling regulatory credits in Q3 2024 [4] - Tesla's regulatory credits business remains strong as rivals struggle to meet emission targets due to lackluster EV demand [7] Impact of US Policy Changes - Incoming US president Donald Trump has promised to roll back emissions targets and EV regulations, which could cost Tesla up to $3.2 billion [2] European Emissions Targets - European manufacturers face tough emissions targets and could incur hundreds of millions in penalties if they fail to comply [6] - Electric vehicle sales in Europe have stagnated, with several countries rolling back EV subsidies [6]