Commission agrees to water down automotive emission targets

BRUSSELS — The European Commission said Monday it will change the way it calculates emissions targets for carmakers in a bid to help the deeply troubled industry.

The executive will put forward an amendment to allow the targets to be based on a three-year average instead of on this year's sales — making it easier for the industry to hit the target without facing steep fines.

"We need predictability and fairness for those who did their homework successfully," said Commission President Ursula von der Leyen after her second meeting with the bloc's biggest automakers and suppliers this year. "We have to stick to the agreed targets, but we need to listen to voices who ask for more pragmatism and technological neutrality."

The current regulation requires carmakers to reduce their emissions by 15 percent in 2025 from a 2021 baseline or be fined €95 per gram of carbon dioxide per kilometer emitted above the target for each noncompliant vehicle sold in the bloc.

The industry had complained that could see the sector hit with fines of up to €15 billion.

Under the executive's latest proposal, carmakers will need to meet the emission reductions over the course of 2025-2027 instead of just 2025.

The scheme was proposed by the European People's Party (EPP), which is part of von der Leyen's political family and is the largest grouping in the European Parliament. Any amendment to the law will have to be approved by both the Parliament and European Council.

Von der Leyen will submit an amendment for fast-track approval later this month.

Green groups were quick to condemn the decision.

"Weakening the EU clean car rules rewards laggards and does little for Europe’s car industry except to leave it further behind China on electric vehicles," William Todts, executive director of green NGO Transport & Environment, said in a statement.

The amendment is part of the Commission's broader automotive action plan. Ideas on how to pull the continent's automakers out of a spiraling crisis brought on by the transition to electric vehicles and growing competition with China will be presented to the public on Wednesday.

Other components of the plan include boosting demand for electric vehicles and creating an EU battery sector, according to a draft seen by POLITICO.

The 2025 emission target is part of the broader Green Deal effort to slash transport emissions by ending the sale of new combustion engine vehicles from 2035. A review of the law is set for 2026, but the Commission said on Monday it will "speed up" that review and include "technological neutrality as a core principle."

The EPP and industry insiders have called for the law's review to be conducted in 2025, which could bolster their argument for tweaking the broader legislation as the review would then be based on 2024's sluggish EV sales figures.

Several member countries, led by Italy and the Czech Republic, have been lobbying for biofuels and e-fuels to be included in the law going forward as the fuels can run in existing engines.

While the bloc debates the future of the combustion engine, Chinese carmakers are racing ahead with EVs, producing cheaper models equipped with better technology than their European peers.

An economic slowdown in China is leading to a surge of exports as local EV companies look for new markets, prompting further hand-wringing in the European Union. The Commission slapped new duties on made-in-China battery-powered cars in 2024 as part of an anti-subsidy investigation.

Von der Leyen met for the second time with the CEOs of Europe's biggest automakers, suppliers and industry groups on Monday ahead of the announcement.

"Let me stress that today was not the end of the dialogue with the industry," she said, adding that a third meeting will take place before the summer holidays.