EU Modifies 2035 Ban on Petrol and Diesel Cars Amid Industry Pressure

Wed Dec 17 2025 13:17:13 GMT+0200 (Eastern European Standard Time)

The European Commission revises its plans to phase out sales of petrol and diesel vehicles by 2035, allowing for more conventional cars amid lobbying from car manufacturers, particularly in Germany.

In a significant policy shift, the EU has reduced its stringent targets for banning new petrol and diesel vehicle sales by 2035. Now, 90% of vehicles must be zero-emission instead of 100%, catering to automotive industry concerns about current market demand. While the automotive sector argues that this flexibility is necessary to avoid heavy penalties, environmental groups warn that this adjustment may slow the transition to electric vehicles and weaken Europe's competitive edge in the green economy.

The European Commission has watered down its plans to ban the sale of new petrol and diesel vehicles by 2035.

Current rules state that new vehicles sold from that date should be zero emission, but carmakers, particularly in Germany, have lobbied heavily for concessions.

Under the European Commission's new plan, 90% of new cars sold from 2035 would have to be zero-emission, rather than 100%.

According to the European carmakers association, ACEA, market demand for electric cars is currently too low, and without a change to the rules, manufacturers would risk multi-billion euro penalties.

The remaining 10% could be made up of conventional petrol or diesel cars, along with hybrids.

Carmakers will be expected to use low-carbon steel made in the EU in the vehicles they produce.

The Commission also expects an increase in the use of biofuels and so-called e-fuels, which are synthesised from captured carbon dioxide, to compensate for the extra emissions created by petrol and diesel vehicles.

Opponents of the move warn this risks undermining the transition towards electric vehicles and leaving the EU exposed to foreign competition.

Green transport group T&E has cautioned that the UK should not follow the EU's lead in weakening its own plans to phase out conventional cars under the Zero Emission Vehicles Mandate.

The UK must stand firm. Our ZEV mandate is already driving jobs, investment and innovation into the UK. As major exporters, we cannot compete unless we innovate, and global markets are going electric fast, stated T&E UK's director Anna Krajinska.

Ahead of the announcement, Sigrid de Vries, director general at ACEA, emphasized the need for flexibility for manufacturers, highlighting that action must be taken soon to avoid penalties.

This change in strategy is indicative of ongoing pressures within the automotive sector and raises questions about the EU's commitment to its green initiatives.

Volvo's rapid transition to an electric vehicle lineup demonstrates the capability within the industry if supported by consistent policy frameworks.

Ultimately, while the amendment may provide immediate relief to manufacturers, it poses risks for Europe's long-term sustainability and leadership in the green vehicle market.