EU lawmakers agree to soften 2035 car emissions target

The three largest mainstream groups in the European Parliament have agreed to soften the European Union's 2035 emissions target for new cars. Under the deal, automakers would have to cut fleet CO2 emissions by 87.5% from 2021 levels, and could cover a further 7.5% by using low-carbon steel made in the EU, Reuters reported, citing a text of the agreement. That is a looser target than the European Commission's 2025 proposal of a 90% cut, which had already replaced the original 100% goal, and it would let combustion-engine and hybrid cars stay on sale after 2035.reuters.com

Negotiators from the centre-right European People's Party (EPP), the centre-left Socialists and Democrats (S&D) and the liberal Renew Europe group reached the agreement early on Tuesday, October 20, Der Spiegel reported. According to Bloomberg, the change would benefit carmakers including BMW Bayerische Motoren Werke AG, Stellantis ↗ 0.93% and Volkswagen.autonews.com+1

What the deal contains

The text also sets an 80% emissions cut for new vans by 2035, according to Reuters. For 2030, cars would still face the 55% reduction the Commission proposed, while the van target would drop to 35% from the Commission's 40%. Automakers could meet the 2030 targets on average across 2029 to 2031. Cars running on renewable fuels could count as zero-emission vehicles, and carmakers could earn "super-credits" for small, affordable electric cars and especially efficient EVs.reuters.com

The Commission's draft required automakers to fully offset the remaining 10% of emissions through green steel and climate-friendly fuels. Electrive noted that the parliamentary compromise also uses green steel as an offset but goes "nowhere near as far" as the Commission's proposal.electrive.com

Votes still ahead

The deal is not yet official. All three groups still have to sign off on it before it becomes the Parliament's position, Reuters reported. The Parliament's transport and industry committees are set to vote on Thursday, October 22. The environment committee, which leads on the file, is expected to vote in early November, with a plenary vote likely in December, according to Der Spiegel. The transport committee had already postponed its vote from October 5 to give the centrist groups more time to agree, Electrive reported.electrive.com+2

Pressure from Paris and Berlin

Once the Parliament settles its position, it will have to negotiate a final text with EU governments. Last week, France and Germany agreed to back a 90% cut for 2035 with no need for compensating measures, Reuters reported. Der Spiegel described the Franco-German position as decisive for the vote among member states, Electrive noted. Final approval in the Council requires a qualified majority of at least 15 countries representing 65% of the EU's population.reuters.com+1

If approved, the changes would end the requirement for new cars sold from 2035 to be climate neutral. Critics warn that this could cost Europe ground to China, Automotive News reported.autonews.com