Tesla loses Toyota and Stellantis from its EU CO2 pool, taking billions with them

Toyota and Stellantis are both withdrawing from Tesla’s European CO2 emissions pool for 2026, according to new EU filings. The two automakers were among the largest paying members of the pool.

The move is the latest blow to Tesla’s regulatory credit revenue, which has already been shrinking globally after the US eliminated its own emission credit market last year.

Tesla’s EU CO2 pool shrinks significantly

Under EU regulations, automakers that can’t meet fleet-wide CO2 emissions targets on their own can join “pools” with manufacturers that have a surplus — like Tesla, which sells only zero-emission vehicles. In exchange, the pooling partners pay Tesla for the privilege of averaging down their fleet emissions.

Tesla has profited enormously from these arrangements. In 2019, Fiat-Chrysler (now Stellantis) signed a deal worth up to $2 billion to pool its fleet with Tesla. Honda and Jaguar Land Rover subsequently joined the pool in following years.

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For the 2025 compliance year, the pool had swelled to include Toyota, Stellantis, Leapmotor, Ford, Honda, Mazda, Subaru, and Suzuki — a massive coalition that UBS analysts estimated could generate over €1 billion for Tesla in Europe alone.

Now, for 2026, EU documents show the pool has contracted to just Tesla, Ford, Honda, Mazda, and Suzuki. Toyota and Stellantis are out.

Why they’re leaving

Toyota believes it can meet its EU emissions targets independently. The Japanese automaker has maintained a high proportion of hybrids in its European fleet for years and has few remaining high-emission models. Its 2025 target was 96.3 grams of CO2 per kilometer, and it was expected to come in right around that figure.

Toyota’s battery-electric vehicle lineup is also expanding. The new Urban Cruiser is hitting European showrooms, and the bZ4X has been performing relatively well, it became the best-selling EV in Denmark in February 2026.

Stellantis has a different strategy. The automaker missed its CO2 target by roughly 6 grams per kilometer in 2025, according to Dataforce forecasts, but it has an ace up its sleeve: Leapmotor. Stellantis holds a majority stake in the Chinese EV maker, which is rapidly scaling European production from its Zaragoza, Spain facility, a plant being adapted to produce up to 200,000 Leapmotor vehicles per year.

By forming its own pool exclusively with Leapmotor, Stellantis can use those zero-emission vehicle sales to offset its fleet average without paying Tesla. Leapmotor delivered over 17,000 vehicles in Europe in Q4 2025 alone and has expanded to over 800 dealer locations across the continent.

The bigger picture for Tesla’s credit revenue

This is part of a broader trend that’s squeezing Tesla’s regulatory credit business from all directions. In 2024, Tesla earned a record $2.76 billion globally from regulatory credit sales. By 2025, that figure dropped 28% to roughly $2 billion, and the trajectory continues downward.

In the US, the emission credit market was officially eliminated in 2025, costing Tesla an estimated $1.4 billion in lost revenue over nine months. In Europe, the European Commission gave automakers three extra years to meet new CO2 targets, reducing the urgency to pool with Tesla.

Now, with two of its largest European pool members leaving, Tesla faces further erosion on the continent that was supposed to partially offset its US losses.

The one caveat: EU pool decisions don’t have to be finalized until December 1 of each year. If Toyota or Stellantis finds itself in a worse emissions position than expected mid-year, they could theoretically rejoin. But the direction of travel is clear, automakers are increasingly finding ways to comply on their own.

Electrek’s Take

This was inevitable, and Tesla knows it. The company has already acknowledged in its financial filings that regulatory credit revenue is declining and will continue to do so. The entire business model was always temporary, it existed because legacy automakers were too slow to electrify and needed to pay someone else for compliance.

For Tesla, this is a manageable hit in the context of its overall business, but it’s one more data point showing that the regulatory credit gravy train is ending worldwide. The automaker generated $2.76 billion from credits in 2024, revenue that dropped straight to the bottom line with essentially zero cost. Replacing that kind of free money with actual vehicle margin requires selling a lot more cars, and that’s getting harder as competition intensifies from every direction.

Ford, Honda, Mazda, and Suzuki remain in the pool for now, but the question is for how long.

Everywhere there’s actual EV competition, which means everywhere except the US, Tesla is seeing its sales decline rapidly.