The European Commission intends to revise its proposed penalties for automakers who fail to meet the 2025 CO₂ emission standards. Instead of assessing compliance on an annual basis, the new proposal would allow manufacturers to achieve the targets based on their fleet’s average emissions over three years.
The European Commission will also introduce proposals to promote consumer adoption of Battery Electric Vehicles (BEV) and elevate domestic automotive battery production. European Commission President Ursula von der Leyen has declared that European automakers will receive a two-year extension to comply with this year’s emissions requirements.
The action is being taken in response to a 5.9% drop in new BEV sales in 2024, as reported by the European Automobile Manufacturers’ Association (ACEA).
Von der Leyen said a targeted amendment will be introduced later this month to provide flexibility to the automotive industry under the 2025 emissions regulations. The change will allow car manufacturers to miss this year’s targets if they exceed the requirements in the following two years. The aim is for a new consumer incentive program to start next year, helping automakers meet their sales targets.
The targets escalate annually, with the ultimate objective of achieving 100% zero emissions by 2035.
According to the European Environment Agency, carbon emissions from new passenger cars decreased by 28% from 2019 to 2023, primarily due to the rise in electric vehicles. However, a decline in EV sales in 2024 has increased significant fines for automakers with higher-emission fleets.
The proposed rule change still requires approval from the EU government. The commission’s draft paper acknowledges that Europe’s automotive industry risks losing market share in BEV technology and faces substantially higher costs compared to competitors.
A key factor is the reliance on Chinese-made batteries, which account for 30% to 40% of a typical car’s value.
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