EU Carmakers Gain Ground in Battle to Soften 2035 Engine Rules

The European Union's retreat from a hard 2035 combustion-engine cutoff is gathering momentum in Parliament, handing the bloc's beleaguered carmakers a tactical win while reigniting a fight over the credibility of the green transition.

The European Parliament rapporteur's report on the review of the CO2 regulation for cars and vans, published on 12 May, was welcomed by the manufacturers' association ACEA as a move toward a more balanced and technology-neutral framework. It builds on the Commission's December Automotive Package, which would replace the de facto 2035 ban on new petrol and diesel sales with a 90 percent tailpipe emissions reduction target, the residual 10 percent offset through low-carbon steel made in the Union, e-fuels or biofuels. In practice, that leaves room for a minority of combustion and plug-in hybrid models beyond 2035, with the 2030 target softened via three-year averaging and super-credits for small electric vehicles built in Europe.

On 18 May, ACEA and European Aluminium escalated the lobbying, jointly urging negotiators to widen the compensatory mechanism to cover low-carbon aluminium and to finalise its definition under the Ecodesign rules before the regulation takes effect. The two industries, they argued, underpin more than 14.5 million EU jobs and must be reformed together rather than in isolation.

Campaigners see a retreat. Transport and Environment has warned that diluting the 2035 target to 90 percent could cut battery-electric sales sharply and add more than a billion tonnes of CO2, with any further weakening toward 80 percent compounding the damage.

The file now moves through trilogue under the Cypriot presidency. With German output falling and Chinese rivals gaining share, Brussels is wagering that flexibility, not absolutism, preserves European industry. The detail will be decided in delegated acts still to come.