EU agrees to end sales of CO2-emitting cars in 2035

The European Union has agreed to enforce a new law that will require all new cars sold in all EU countries to have zero carbon emissions from 2035.

The votes in support of the new rule by the European Commission is coming three weeks later than planned due to Germany’s opposition to the policy.

The EU autos industry is revving up its complaints against the proposal, with one CEO calling the new law “plain stupid”. And find out the most cost-effective way to manage peak flood flows in today’s ESG Spotlight.

European Union countries’ energy ministers are set to give final approval to the bloc’s law to end sales of new CO2-emitting cars in 2035, after Germany won an exemption for cars running on e-fuels.

The EU law will require all new cars sold to have zero CO2 emissions from 2035, and 55% lower CO2 emissions from 2030, versus 2021 levels.

The vote comes three weeks later than planned after Germany’s transport ministry lodged last-minute opposition to the law, threatening to derail the EU’s main policy for bringing cars in line with its climate change targets.

The European Commission struck a deal with Germany over the weekend to resolve the row, by offering assurances that combustion engine cars that only run on e-fuels will be exempted from the 2035 ban. Most countries are likely to back the law, EU officials said, which would allow it to enter into force. Italy and Poland are set to oppose, with Romania and Bulgaria expected to abstain.

The new proposals have also stirred up the EU autos industry recently as carmakers argue that the new rules are too costly, rushed and unnecessary. The European Commission says the rules are needed to cut harmful emissions and prevent a repeat of the Dieselgate scandal.

European Union countries and lawmakers will negotiate “Euro 7” proposals this year on tighter limits for car emissions – for diesel cars, but not petrol – and for heavy-duty trucks and buses, including nitrogen oxide and carbon monoxide.

The Commission’s proposal widens real-driving emissions (RDE) testing and adds continuous testing of emissions via an on-board monitoring system. Euro 7 would take effect in mid-2025 for cars and in mid-2027 for trucks and buses. The rules would also cover tyre and brake emissions.

Executives including Stellantis CEO Carlos Tavares say the rules are “useless” while carmakers invest tens of billions of euros in electric vehicles (EVs) and start phasing out fossil-fuel cars. Iveco CEO Gerrit Marx called the proposals “plain stupid”.

Mattias Johansson, Volvo Cars’ head of governmental affairs, told Reuters the 2025 deadline left “practically no reasonable lead time” to make engine changes. Volvo has committed to being fully electric by 2030.

Lobby group the European Automobile Manufacturers’ Association says pollutant reductions from Euro 7 will be minimal. The Commission argues they will be significant.

Credit: Reuters