EU loosens its 2035 ban on gasoline and diesel cars, permitting 10% of combustion vehicles

The European Union has proposed a target of 90 percent zero emissions, while carmakers caution that low demand for electric vehicles could lead to significant fines.

The European Commission has revised its plans to prohibit the sale of new petrol and diesel cars by 2035, responding to pressure from automakers throughout the bloc.

According to current regulations, every new vehicle sold starting in 2035 is anticipated to be “zero emission.” Nonetheless, the Commission’s updated proposal would mandate that 90% of new cars sold from that date comply with the zero emission standard, instead of 100%.

The final 10% would consist of traditional petrol or diesel vehicles, as well as hybrids. Carmakers will be mandated to utilize low carbon steel produced within the EU and enhance their dependence on biofuels and e-fuels, which are synthesized from captured carbon dioxide, to mitigate additional emissions.

The European carmakers association, ACEA, contends that the existing market demand for electric vehicles is insufficient and that manufacturers are at risk of incurring “multi-billion euro” penalties unless they are granted greater flexibility.

Critics have cautioned that this action may undermine the shift towards electric vehicles and expose the EU to increased global competition.

The green transport organization Transport and Environment has advised the UK to refrain from adopting the EU’s strategy of diluting its Zero Emission Vehicles Mandate.

“The UK must remain resolute. The ZEV mandate is actively fostering job creation, attracting investment, and spurring innovation within the UK. “As leading exporters, we must innovate to remain competitive, especially as global markets rapidly transition to electric,” stated Anna Krajinska, director of T&E UK.

Prior to the announcement, ACEA director general Sigrid de Vries emphasized that flexibility for manufacturers was “urgent.”

“With 2030 approaching, the market demand remains insufficient to mitigate the risk of multi-billion-euro penalties for manufacturers,” she stated.

“Building the charging points and implementing fiscal and purchase incentives to align the market will require time.” Policy makers need to allow manufacturers some flexibility to maintain jobs, foster innovation, and encourage investments.

UK car manufacturers have previously advocated for enhanced incentives to increase the adoption of electric vehicles in anticipation of the government’s scheduled prohibition on new petrol and diesel car sales by 2030.

Throughout the industry, manufacturers have allocated billions to modify production lines as governments advocate for greener transportation to achieve climate objectives.

Volvo announced that it has “built a complete EV portfolio in less than 10 years” and is prepared to transition to fully electric, utilizing hybrids solely as a stepping stone. The company contended that if it were able to transition from petrol and diesel vehicles, others could follow suit as well.

“Undermining long-term commitments for immediate benefits jeopardizes Europe’s competitiveness for years ahead,” Volvo stated.

“An unwavering and forward-thinking policy framework, along with investments in public infrastructure, will yield tangible advantages for customers, the climate, and the industrial strength of Europe.”

Volkswagen, the German car manufacturer, expressed its approval of the Commission’s draft proposal on new CO₂ targets, characterizing it as “economically sound overall.”

“It is very encouraging that small electric vehicles will receive special support in the future.” The statement emphasized the necessity of making the CO₂ targets for 2030 more adaptable for passenger cars and recalibrating them for light commercial vehicles.

“Allowing vehicles with combustion engines into the market while addressing emissions is a sensible approach that aligns with current market dynamics.”

Colin Walker, who leads transport at the Energy and Climate Intelligence Unit, stated that a stable policy in the UK would support ongoing investment in charging infrastructure and safeguard employment.

“It was government policy that led to Sunderland being selected for the production of Nissan’s original electric Leaf, and today the latest Nissan EV has begun coming off the production lines in the North East, ensuring job security for years ahead,” he stated.

Fiona Howarth, chief executive of Octopus Electric Vehicles, cautioned that diluting UK targets in reaction to EU modifications would convey a “damaging signal to investors, manufacturers, and supply-chain partners.”

Many had already made significant investments in the transition, believing that the UK would remain committed to the path ahead, she stated.