BRUSSELS (WHN) – The European Commission has effectively pulled back from its ambitious 2035 target to eliminate the sale of new petrol and diesel cars. Instead of a hard stop, the new directive will mandate that 90% of new cars sold from that year must be zero-emission, a significant concession following intense lobbying from automotive manufacturers, particularly those in Germany.
This recalibration means that the remaining 10% of new vehicles can still be powered by traditional internal combustion engines, including hybrids. Carmakers, facing the specter of “multi-billion euro” penalties under the original 100% zero-emission rule, have argued that market demand for electric vehicles (EVs) simply hasn’t scaled fast enough. Sigrid de Vries, director general at the European carmakers association, ACEA, had called for “flexibility,” stating that “2030 is around the corner, and market demand is too low.”
The shift is not just about sales figures; it’s about the complex industrial pipeline required for this transition. Building out charging infrastructure and implementing widespread consumer incentives are cited as critical missing pieces. The Commission, however, is signaling a path forward that includes increased use of biofuels and synthetic e-fuels, which are produced by capturing carbon dioxide. Carmakers will also be expected to integrate low-carbon steel manufactured within the EU into their vehicles, adding another layer of supply chain consideration.
This watered-down mandate, however, has drawn sharp criticism. Opponents argue it risks slowing down the crucial shift to electric mobility and could leave the EU vulnerable to international competition that maintains stricter targets. The UK’s green transport group, T&E, has specifically urged the UK government not to follow Brussels’ lead. Anna Krajinska, T&E UK’s director, emphasized the economic imperative: “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.”
The UK’s own Zero Emission Vehicles Mandate aims for a complete phase-out of new petrol and diesel car sales by 2030. Carmakers in the UK have previously echoed calls for better incentives to encourage consumer adoption of EVs. The global automotive industry has already committed billions to retooling factories and developing new EV platforms, banking on government mandates to drive demand. Volvo, for instance, has built a comprehensive EV portfolio in under a decade, advocating for consistent policy. The Swedish manufacturer cautioned that “Weakening long-term commitments for short-term gain risks undermining Europe’s competitiveness for years to come.”
Volkswagen, a key German player, has taken a different stance, welcoming the European Commission’s proposal as “economically sound overall.” The German carmaker specifically highlighted the potential for “special support” for smaller electric vehicles and the flexibility offered for 2030 CO₂ targets. Their statement indicates that “Opening up the market to vehicles with combustion engines while compensating for emissions is pragmatic and in line with market conditions.”
This divergence in opinion underscores the intricate balance governments and industry are trying to strike. On one hand, there’s the undeniable pressure to meet climate targets and foster innovation in green technologies. On the other, there’s the pragmatic reality of consumer adoption rates, manufacturing capacity, and the substantial financial risks involved. Colin Walker of the Energy and Climate Intelligence Unit (ECIU) think tank noted that “stable policy” in the UK provides the confidence for investments in critical infrastructure like charging stations, citing the success of Nissan’s EV production in Sunderland as a direct result of government policy.
Fiona Howarth, CEO of Octopus Electric Vehicles, expressed concern that any dilution of the UK’s goals in response to the EU’s changes would send a “damaging signal to investors, manufacturers and supply-chain partners” who have already made significant investments based on the existing trajectory. The transition, it seems, is as much about economic signaling as it is about technological advancement.
The debate over the pace of the automotive transition is far from over. The EU’s concession, while offering breathing room for some manufacturers, raises questions about the long-term competitiveness of the European automotive sector. The challenge now lies in finding a path that balances environmental imperatives with industrial realities, a task made more complex by the ongoing development of alternative fuels and the evolving demands of the global market.