The EU has confirmed it will water down its landmark 2035 ban on the sale of new petrol or diesel cars, yielding to heavy pressure from the car industry and leaders from several EU member states including Germany and Italy.
Under current legislation, manufacturers were obliged to ensure that 100% of production of cars and vans had zero emissions up to 2035.
The European Commission confirmed on Tuesday that this will now be reduced to 90%, enabling the continued manufacture of a portion of plug-in hybrid electric cars, or even combustion engines beyond 2035.
However, in a carrot-and-stick approach, the remaining 10% of assembly line output that is not carbon neutral will need to be compensated by other green measures on the factory floor, including the use of green steel made in Europe or use of biofuels in non-electric vehicles.
“This will allow for plug-in hybrids (PHEV), range extenders, mild hybrids, and internal combustion engine vehicles to still play a role beyond 2035, in addition to full electric (EVs) and hydrogen vehicles,” the commission said.
The commission has also relaxed targets for electric vans, reducing the requirements for a 50% reduction in carbon emissions by 2030 to 40%.
The move, which follows lobbying by the German chancellor, Friedrich Merz, and the Italian prime minister, Giorgia Meloni, will be seen as a victory for the European car industry, which has struggled to make the transition to electric and faces growing competition from Chinese rivals.
The decision, which had been widely anticipated in recent days, has already been denounced by the Green party in the European parliament, which has said it amounts to a “gutting” of flagship legislation aimed at cutting Europe’s emissions.
The European Commission president, Ursula von der Leyen, who championed the green deal and the cornerstone car emissions regulation in 2022, said: “Europe remains at the forefront of the global clean transition.”
She said the proposals, which must be supported by the European parliament, were taken after “intense dialogues with automotive sector, civil society organisations and stakeholders”.
In a package of measures unveiled in Strasbourg on Tuesday, the commission also revealed new incentives for manufacturers to produce small cars, the most popular category of vehicles in Europe.
Up to 2035 they will be offered “super credits” as an incentive to make small, affordable electric cars, with each vehicle counting for 1.3 cars within EU quotas, allowing manufacturers to bank emissions targets.
It also cited measures to stimulate demand for electric cars from large corporate buyers which are seen as key in accelerating the take-up of EVs because commercial fleets are one of the principal suppliers of the secondhand car market.
