The EU’s European Commission has proposed more flexibility on CO2 targets for the auto industry. This would mean carmakers would have three years, rather than one, to meet new CO2 fleet averages for cars and vans and avoid incurring fines.
Car manufacturers are required to meet the average of 93.6 grams per kilometre for all new car deliveries in the EU in 2025, progressing towards zero emissions by 2035.
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The targets that will apply from 2025 onwards are based on the WLTP (Worldwide harmonized Light vehicles Test Procedure) and were set out in Commission Implementing Decision (EU) 2023/1623:
- Cars: 93.6 g CO2/km (2025-2029) and 49.5 g CO2/km (2030-2034)
- Vans: 153.9 g CO2/km (2025-2029) and 90.6 g CO2/km (2030-2034)
Currently, the annual specific emission targets of each manufacturer are based on these EU fleet-wide targets, taking into account the average mass of its registered new vehicles.
As things stand, if the average CO2 emissions of a manufacturer’s fleet exceed its specific emission target in a given year, the manufacturer must pay – for each of its new vehicles registered in that year – an excess emissions premium of €95 per g/km of target exceedance.
However, the industry has lobbied for more flexibility on the targets and the EC appears to have listened – though some e-mobility pressure groups will likely be unhappy with the change.
Three-year flexibility
The European Commission has now announced that it will add a three-year flexibility for carmakers to comply with the 2025 CO2 limit. This will allow them to not meet targets this year or 2026, as long as they overperform in 2027 to ensure a compliant average.
The change was presented by the EC as a balanced solution under the principle of ‘banking and borrowing’ but with the targets staying the same. EC President von der Leyen said in a statement that the change means ‘more breathing space for the industry and more clarity’.
The proposed amendment still needs to be agreed by the European Parliament and the Council, but that is likely to be a formality.
Europe ‘slowing down electric vehicle transition’
While EU carmakers will welcome the change, there is some disagreement and dissent from the latest EC position. Chris Heron, Secretary General, E-Mobility Europe, said: “The proposal for three-year CO2 limit flexibility will significantly delay Europe’s electric vehicle roll-out across the next two years, risking around half a million fewer electric cars entering the EU market in 2025. That uncertainty is bad news for investors in EU charging infrastructure, battery production, and e-mobility overall”.
“We have big legal questions now. Changing the rules midway through 2025 is unfair for the automakers that worked to comply with the law in good faith.
“Europe slowing down its electric vehicle transition will leave the door wide open for China to continue as the undisputed market leader, putting long-term job creation at risk.”
