The European Commission has watered down its flagship plan to end the sale of new petrol and diesel cars by 2035, following intense lobbying from carmakers concerned about slowing demand for electric vehicles.
Under existing rules, all new cars sold in the EU from 2035 were required to be “zero emission”. However, the Commission’s revised proposal would require only 90 per cent of new vehicles sold from that date to meet the zero-emissions standard, rather than 100 per cent.
The remaining 10 per cent could consist of conventional petrol or diesel vehicles, as well as hybrids, with additional measures intended to offset the resulting emissions.
The European Automobile Manufacturers’ Association (ACEA), which represents major carmakers including those in Germany, has repeatedly warned that demand for electric vehicles is not growing fast enough to meet the current targets. Without changes, it said manufacturers would face “multi-billion-euro” penalties.
Sigrid de Vries, director general of ACEA, said ahead of the announcement that greater flexibility was urgently needed.
“2030 is around the corner, and market demand is too low to avoid the risk of multi-million-euro penalties for manufacturers,” she said. “It will take time to build charging infrastructure and introduce fiscal and purchase incentives to get the market on track.”
Alongside the softer sales targets, the Commission said carmakers would be expected to increase the use of low-carbon steel produced in the EU. It also anticipates greater use of biofuels and so-called e-fuels, synthetic fuels made using captured carbon dioxide, to compensate for the additional emissions generated by petrol and diesel vehicles.
Critics, however, warned that the move risks undermining Europe’s transition to electric vehicles and weakening its competitiveness against global rivals, particularly China and the United States.
Environmental group Transport & Environment (T&E) cautioned that the UK should not follow Brussels by weakening its own plans under the Zero Emission Vehicles (ZEV) mandate.
“The UK must stand firm,” said Anna Krajinska, T&E UK’s director. “Our ZEV mandate is already driving jobs, investment and innovation into the UK. As major exporters we cannot compete unless we innovate, and global markets are going electric fast.”
Reaction from carmakers has been mixed. German giant Volkswagen welcomed the Commission’s draft proposals, calling them “economically sound overall”.
“It is extremely important that the CO₂ targets for 2030 are made more flexible for passenger cars,” the company said. “Opening up the market to vehicles with combustion engines while compensating for emissions is pragmatic and in line with market conditions.”
By contrast, Volvo argued that weakening long-term commitments would harm Europe’s industrial future. The Swedish carmaker said it had built a full electric vehicle portfolio in less than a decade and was prepared to go fully electric, using hybrids only as a short-term transition.
“Weakening long-term commitments for short-term gain risks undermining Europe’s competitiveness for years to come,” Volvo said. “A consistent and ambitious policy framework is what will deliver real benefits for customers, the climate and Europe’s industrial strength.”
Carmakers in the UK have previously called for stronger incentives to encourage drivers to switch to electric vehicles ahead of the government’s planned ban on new petrol and diesel cars from 2030.
Colin Walker, head of transport at the Energy and Climate Intelligence Unit (ECIU), said policy stability was crucial if the UK was to retain investment.
“It was government policy that saw Sunderland chosen to build Nissan’s original electric Leaf,” he said. “Today, the latest Nissan EV is rolling off production lines in the North East, securing jobs for years to come.”
Fiona Howarth, chief executive of Octopus Electric Vehicles, warned that any UK retreat in response to EU changes would send a “damaging signal” to investors and manufacturers.
“Many have already invested heavily on the assumption the UK would stay the course,” she said.
As governments worldwide continue to push greener transport to meet climate targets, the EU’s decision highlights the growing tension between environmental ambition and industrial reality, and raises fresh questions over how fast the transition away from petrol and diesel can realistically go.
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EU waters down plans to end new petrol and diesel car sales by 2035