Brussels Blinks on 2035 But Europe's Carmakers Want More

The EU's automotive rethink offers industry breathing room. Critics warn it may slow the very transition it seeks to protect.

Brussels, 17 March — Three months after the European Commission published its long-awaited Automotive Package, the battle over what it actually means for Europe's carmakers is entering a sharper phase.

The package, unveiled in December, amounts to the most significant softening of the EU's clean vehicle agenda in a decade. The headline change is a reduction in the 2035 zero-emissions target for new cars from 100% to 90%, with the remaining 10% of tailpipe emissions permitted to be offset using EU-manufactured low-carbon steel or approved e-fuels and biofuels. Plug-in hybrids, mild hybrids, and combustion engine vehicles will, in effect, remain on sale beyond 2035.

The Commission has framed this as industrial pragmatism. The European auto sector employs 13.6 million people, anchors manufacturing ecosystems across Germany, France, Italy, Spain, and Central Europe, and faces a genuine competitive threat from Chinese electric vehicle producers whose cost advantages remain substantial. Battery-electric cars captured just 19.3% of EU market share in January, a gain on last year's 14.9% but well short of the trajectory targets originally implied.

Yet sceptics are not reassured. Transport & Environment, the Brussels-based campaign group, estimates the 90% target could result in 25% fewer battery-electric vehicles sold in 2035 than under the current framework. In a sharp assessment published this month, it warned that loosening 2030 targets risks delaying the price parity between EVs and combustion vehicles that is expected to arrive between 2026 and 2030 — the very tipping point the industry needs.

The European Parliament and Council are now debating their positions. Some member states are expected to push for further dilution. Industry groups, led by ACEA, have welcomed the package but insist the regulatory simplification exercise is far from over.

The risk, for Brussels, is that flexibility becomes a substitute for strategy.