The EU has softened its 2035 car emissions ban, raising questions about climate targets and the pace of EV adoption.
European officials on Tuesday moved to ease their ban on sales of cars with internal combustion engines by 2035, responding to pressure from governments and automakers.
Currently, EU law mandates that all new cars after 2035 need to have zero CO2 emissions. But, after industry pressure from some member states and the automotive industry, this target has now been watered down.
The Commission has eased the ban, saying that from 2035 onwards, carmakers will need to comply with a 90 per cent tailpipe emissions target instead of 100 per cent.
European Commission vice-president Stéphane Séjourné called the plan a “lifeline” for Europe’s automotive industry while insisting the bloc’s climate objectives were still intact.
While some EU member states, like Italy and Germany, pushed for the ban to be reversed, others have slammed the increased “flexibility” for combustion engine cars.
French environment minister Monique Barbut said that France will do “all we can” to stop the proposal from becoming law when it is put to EU member states for approval.
Critics add that the reversal sends confusing signals for both climate targets and manufacturers.
What does the rollback mean for EU emissions targets?
The transport sector is the only sector where greenhouse gas emissions have increased in the EU in the last three decades. Cars make up just over 60 per cent of total greenhouse gas emissions from transport, according to European Environment Agency figures.
EU officials say changing the limit will not affect progress toward making the 27-country bloc's economy climate neutral by 2050. Climate Commissioner Wopke Hoekstra told Euronews it was a "smart, wise compromise for climate and competitiveness".
But it does mean manufacturers will still be able to sell a limited number of polluting vehicles, including plug-in hybrids, electric vehicles with small combustion engines to extend their range and petrol and diesel cars, past 2035.
To do so, they will have to compensate for the remaining 10 per cent of emissions from these kinds of cars using two avenues. The first is by using low-carbon steel made in the EU. The second is out of their control and will come with the use of e-fuels or biofuels.
Séjourné told reporters in Strasbourg this week that “all potential further emissions generated have to be fully offset upstream”.
Fully electric and hydrogen vehicles will also be encouraged, with manufacturers eligible for “super credits” if they produce them.
Small, compact and affordable electric vehicles made in the EU before 2035 could count as 1.3 vehicles, for example, making it easier for companies to reach emissions target quotas without incurring fines.
‘Complexity over clarity’: Clean transport experts slam move as confusing
Critics say that, instead of a “lifeline”, the rollback is confusing for an automotive industry already preparing for the zero emissions target.
"The EU has chosen complexity over clarity. Breeding faster horses could never have halted the ascent of the automobile,” says William Todts, executive director of clean transport think tank Transport & Environment (T&E).
“Every euro diverted into plug-in hybrids is a euro not spent on EVs while China races further ahead. Clinging to combustion engines won't make European automakers great again.”
T&E estimates that up to 25 per cent fewer battery electric vehicles would be sold in 2035 than would have been under the current target. It adds that credits for advanced biofuels and e-fuels would also allow carmakers to sell fewer EVs in return for non-existent emissions savings.
And, in the case of advanced biofuels, which it says can’t be scaled sustainably, it would also increase Europe’s reliance on imports of used cooking oil and animal fats that are often subject to fraud.
Chris Heron, secretary general of trade association E-Mobility Europe, adds that “hesitation is not a strategy”.
“Changing the rules midway through the game undermines business confidence after companies have already committed capital and built factories around a 100 per cent trajectory.”
Is a 2035 combustion car ban ‘no longer feasible’?
At the end of August, the European Association of Automotive Suppliers (CLEPA) and the European Automobile Manufacturers' Association (ACEA) wrote to European Commission President Ursula von der Leyen to say that a 100 per cent emissions reduction target for cars by 2035 was no longer feasible.
The letter argued that while its signatories were committed to achieving the EU’s net zero by 2050 goal, manufacturers in the bloc are still almost totally dependent on Asia for batteries and face issues with US tariffs, higher manufacturing costs and a varied charging infrastructure.
"Meeting the rigid car and van CO2 targets for 2030 and 2035 is, in today’s world, simply no longer feasible," they wrote, adding that legal mandates and penalties would not drive the transition.
On the other side of the debate, more than 150 bosses from Europe’s electric car industry signed an open letter earlier this month urging the EU to stick to the 2035 emissions target. Referring to lobbying by the wider automotive industry, the letter said they were "deeply concerned about recent efforts to dilute your objectives”.
With signatories from Volvo Cars and Polestar, it emphasises that any delays to the target would mean stalling Europe’s EV market, handing an advantage to competitors elsewhere in the world and eroding the confidence of the market’s investors.
Allowing the extension of transitional technologies like plug-in hybrids or CO2-neutral fuels, the letter adds, creates uncertainty and slows the shift to electric vehicles as Chinese EV manufacturers push ahead.
“Every delay in Europe only widens the gap with China,” the letter reads.
Both the EU and the US are moving more slowly in adopting electric cars than China, where battery vehicles were 34 per cent of the market in the third quarter. The growth of battery cars in China has been fuelled by state assistance and ferocious competition among Chinese automakers producing affordable vehicles.
Is electrification now unavoidable?
Tristan Beucler, industry analyst from think tank Strategic Perspectives, says that electrification will happen, “with or without the EU”.
“By choosing to scrap a clear industrial target, the Commission is weakening the business case for those companies that have made the necessary investments to electrify, and prolonging the life of a technology that has no path to competitiveness in the next decade,” Beucler adds.
Sales of battery-only cars in Europe rose 26 per cent for the first 10 months of this year compared to the same period last year. Electric-only cars rose to 16 per cent of new car sales.
Yet petrol and diesel cars, though declining, remain significant. With the new 90 per cent emissions target, the EU expects that non-electric cars will make up around 30 to 35 per cent of sales by 2035.
