EU’s Shift on the 2035 Combustion‑Engine Ban: What It Means for the Auto Industry

The European Commission is reportedly reconsidering its 2035 ban on new gasoline and diesel cars. Instead of a zero‑emission requirement, the proposal would enforce a 90 % CO₂ reduction for manufacturers’ average fleet emissions. This change could keep “high‑efficiency” internal‑combustion engines, plug‑in hybrids and range‑extender EVs on European roads beyond the previously set deadline.

Why the Original Ban Faced Pushback

When the EU first announced that all new passenger vehicles must emit no CO₂ by 2035, it sparked fierce resistance from:

  • Automakers fearful of massive re‑tooling costs.
  • Member states like Germany, Italy and Poland, whose economies rely heavily on the automotive sector.
  • Industry groups warning that a hard deadline could jeopardise up to tens of thousands of jobs.

Data from the International Energy Agency (IEA) shows that the EU’s transport sector contributes roughly 25 % of the bloc’s total CO₂ emissions, making the ban a central climate‑policy lever.

The New 90 % CO₂ Reduction Target

According to EVP (European People’s Party) leader Manfred Weber, the revised rule would require manufacturers to cut average fleet emissions by 90 % relative to 2020 levels. This aligns with the EU’s broader “technology‑neutral” approach, allowing:

  • Highly efficient gasoline engines with advanced combustion technology.
  • Plug‑in hybrid electric vehicles (PHEVs) that combine an electric motor with a smaller internal engine.
  • Battery‑electric cars equipped with range extenders.

Under the proposal, the strict 100 % zero‑emission goal would be postponed until after 2040, giving manufacturers additional time to scale up EV production while still meeting a robust climate target.

Real‑World Impact: Case Studies from the Industry

Volkswagen Group has already announced plans to sell 70 % of its European fleet as electric or hybrid by 2030. A 90 % CO₂ target gives VW the flexibility to keep producing its latest “Turbo‑charged Efficient Dynamics” gasoline engines alongside EVs.

Stellantis (owner of Peugeot, Opel, and Fiat) is investing €30 billion in battery production across Europe. The revised rule allows the group to continue offering efficient diesel models in markets where EV infrastructure is still developing.

In contrast, Bloomberg Energy reports that Norway’s all‑electric fleet (over 75 % of new cars) was achieved without a hard EU ban, highlighting that strong consumer incentives can also drive rapid adoption.

What the Future Holds for Sustainable Mobility

Key Trends to Watch

  • Battery‑as‑a‑Service (BaaS): Manufacturers are experimenting with subscription models that lower the upfront cost of EVs.
  • Hydrogen‑fuel‑cell trucks: Expected to complement passenger‑car electrification, especially for long‑haul routes.
  • Digital CO₂ monitoring: Real‑time emissions tracking will become mandatory for fleet reporting under the new EU guidelines.

Policy Landscape Beyond the Ban

The European Commission is also set to unveil a battery strategy and new rules for “green” company cars. These measures will work hand‑in‑hand with the softened combustion‑engine target, ensuring the bloc stays on track for its 55 % emissions reduction by 2030 pledge.

FAQ

Will gasoline cars be completely banned in the EU after 2035?
No. The proposal replaces the zero‑emission deadline with a 90 % CO₂ reduction target, allowing efficient combustion engines to remain on the market.
How does the 90 % target compare to the original plan?
The original plan required 100 % zero emissions by 2035. The new target still aims for a drastic cut in emissions but offers more flexibility for manufacturers.
What role will plug‑in hybrids play under the new rules?
Plug‑in hybrids can count toward the fleet average, provided the overall CO₂ emissions meet the 90 % reduction goal.
Will this change affect the EU’s climate goals?
Officials argue it balances technology neutrality with climate ambition, keeping the bloc on a path to meet its 2030 and 2050 climate targets.
How will the automotive workforce be impacted?
The softer timeline is expected to safeguard thousands of jobs while still encouraging a shift toward greener technologies.

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