EU Eases 2035 CO2 Target for New Cars

The European Commission has proposed revising its landmark 2035 target for carbon dioxide emissions from new cars, easing what amounted to a ban on internal combustion engines and allowing limited sales of hybrid and fuel-burning vehicles after that date. The change, unveiled this week, responds to intense lobbying from automakers and several EU governments facing challenges in shifting to electric vehicles.

Under the original 2023 rules, carmakers were required to achieve a 100 percent reduction in fleetwide CO2 emissions from 2021 levels by 2035, effectively prohibiting new sales of gasoline or diesel vehicles to align with the bloc's goal of climate neutrality by 2050. The updated proposal lowers this to a 90 percent cut, creating a 10 percentage point allowance for emissions. Automakers can meet this gap by offsetting pollution through measures such as using biofuels, synthetic fuels, or low-carbon steel produced in Europe. The plan also introduces flexibility for 2030 targets, permitting emissions to be averaged over three years, and reduces the goal for light commercial vehicles to 40 percent from 50 percent.

The revision follows months of pressure from major car...