Ola Kaellenius, the CEO of Mercedes-Benz, became the latest industry voice to call out on the European Union’s plan to ban sales of CO2-emitting vehicles from 2035.
Reuters reported this week that the executive warned the EU needs a “reality check,” or risk “heading at full speed into a wall.”
He argued that consumers would simply hurry to buy internal-engine combustion (ICE) vehicles powered by petrol or diesel before the ban takes place.
Kaellenius further added that the European auto market could “collapse” if the measure goes ahead, calling for tax incentives instead.
The chief executive also said cheaper power prices at charging stations would encourage consumers to switch to electric vehicles.
“Of course we have to decarbonise, but it has to be done in a technology-neutral way,” Kaellenius said, adding that “we must not lose sight of our economy.”
Reacting to the news, US EV maker Tesla‘s CEO Elon Musk wrote on X, “Just make good EVs!”
In early 2025, the Mercedes-Benz Group unveiled its most affordable electric sedan to date, as it aims to compete with Tesla‘s Model 3. The CLA starts from $42,750 in the US.
Earlier this month, the company announced that the new electric GLC SUV will debut at the IAA Mobility show in Munich, on September 7.
The electric portfolio of the German brand in the US includes the compact EQB SUV and the G-580 G-wagon. All models have a range of about 200 to 300 miles (300 to 500 km).
The lineup also included the mid-size luxury EQE sedan and the EQE SUV, the two latter with AMG options, plus Mercedes’ flagship model, the EQS, available as both a SUV and a sedan.
However, the company announced last month it would temporarily halt production of all variants of its EQE and EQS electric models in the US from September 1.
The information was revealed to InsideEVs by a spokesperson for the brand. Dealers have been informed that order books for the models were closed.
Mercedes, founded and headquartered in Germany, is a market leader in Europe. However, second quarter sales dropped year over year by 12% in the US and by 19% in China.
When considering only fully electric vehicles, the overall sales figures from the brand from April to June were down 24% compared to a year earlier.
According to Motor Intelligence estimates, Mercedes sold 31,540 vehicles in the US last month, including both its ICE and electric models. Tesla, which produces only fully electric vehicles, sold 53,816 units, the same data showed.
