by Amid growing regulatory pressure and international trade challenges, the European Union has provided crucial support to automakers. After active lobbying by key players in the automotive industry, the EU will soften the upcoming CO2 emission standards.
This is a significant victory for automotive conglomerates, which are already facing the consequences of tariff restrictions and their impact on global markets and supply chains.
Initially, the EU required a 15% reduction in emissions by 2025 compared to 2021 levels. Manufacturers strongly objected, calling the goals unattainable and warning of potential fines of up to 15 billion euros. Under the current rules, companies pay 95 euros for every gram of CO2 above the limit, multiplied by the number of cars sold – the sums add up quickly.
Last month, the European Parliament proposed a compromise. Instead of assessing emissions solely for 2025, they will be calculated as an average for the 2025-2027 period. This will give manufacturers additional time to ramp up production of electric vehicles, which offset sales of internal combustion engine (ICE) vehicles.
According to media reports, 458 MEPs voted for the changes, 101 voted against, and 14 abstained. The amendment will be formally approved.
The changes came just in time
The softening of requirements will help European brands compete with Chinese rivals. However, not everyone approves of these changes.
According to Lucien Mathieu from Transport & Environment, the delay will allow manufacturers to reduce their efforts in developing innovative electric vehicles.
“The irony is that the EU is postponing emission targets precisely at a time when electric vehicle sales are growing,” he noted. “This boom was driven by new affordable models created to meet the original requirements. The delay will slow the pace of the transition to electric vehicles and investments in the industry.”
