Europe will no longer hold on to its long-promised ban on new registrations of gasoline and diesel cars as of 2035. The Commission has settled for a rewrite, now demanding that the average vehicle sold will be obliged to emit 90% less CO2 after that deadline. Pitched as a measure to safeguard jobs in the auto industry, this would throw a lifeline to all currently available drivelines.
An official announcement from European Commissioner Ursula von der Leyen is awaited. She was surpassed by her EPP colleague, chairman Manfred Weber, who made the news public on Thursday.
The European Commission has been in continuous talks with the car industry this week and is scheduled to officially release its evaluation of the 2035 ban next week. European People’s Party (EPP) leader Manfred Weber, chairman of the European Parliament, already acknowledged on Thursday that “a complete ban is off the table” to German newspaper Bild.
90% cut
Weber added that the Commission has accepted a framework that would require a 90% cut in average carbon dioxide emissions from new cars by 2035 rather than a complete elimination. Because the rules are calculated across a manufacturer’s fleet, automakers can continue selling a limited number of combustion models alongside electric vehicles, as long as the overall emissions stay within the cap.
Weber further said that rescheduling the complete ban to 2040, a scenario under discussion during the official talks, has also been scrapped. The Commission, which is stepping back from one of its most ambitious pledges to combat climate change, has yet to formally confirm these details.
Months of lobbying
The reversal of the ban follows months of lobbying by countries with large auto industries, including Germany, France, and Italy. Critics of the ban argued that the timeline underestimated the cost of electrification, the slow rollout of charging infrastructure, and the risk of ceding market share to Chinese manufacturers that already dominate battery supply chains.
The latter has been Europe’s so-called Achilles heel, as it has failed to build an appropriate battery manufacturing ecosystem. Rollout of new factories to compensate for the failure of the crown jewel, Northvolt, is stumbling.
Supporters of the original target see the rethink as a setback. Some lawmakers warn that easing the rules will not close the technology gap with China and could blunt investment incentives just as global competition intensifies.
Two affiliated automakers that positioned themselves as early electric leaders, Volvo and electric-only brand Polestar, have publicly opposed weakening the targets. They say it creates uncertainty while it undermines their past investments in electrification.
Job cuts
For much of the European auto industry, however, the revised approach offers relief. Allowing combustion engines to remain part of the sales mix extends the lifecycle of existing plants and supplier networks, easing some of the strain from the wave of job cuts sweeping the sector.
Keeping the door ajar to the combustion engine also opens the door to alternative solutions, such as synthetic and biofuels. Investments in these energy sources, which are challenging to scale up, have been hampered by the 2035 ban.
However, their role remains politically contested, but official bodies like the Association of Automotive Suppliers, CLEPA, continue to support their go-to-market.
A complete surprise, the new compromise is not. The EU has already postponed other environmental rules and lowered the ambition of its 2040 climate target. Allegedly, to prioritize industrial stability. The big question remains: how will Brussels uphold measures to sustain demand for battery-powered models, which are more expensive?
The new decision could further delay the cost efficiency of electric cars. From a political perspective, the EU could face reputational damage. The dilution illustrates Europe’s fragmented stance and its inability to stick to courageous decisions.
