EU ministers remain split over how far Brussels should roll back CO₂ targets for cars and vans. A Council debate exposed a sharp divide between the electrification camp and those pushing for alternative fuels. The incoming Irish Presidency now inherits a file with no consensus in sight.
The debate also covered the Commission’s proposal for new CO₂ emission performance standards for new passenger cars and vans, part of the automotive package presented last December in response to what Brussels called “serious challenges” facing the European car industry.
The central divide is now clear. One group of member states wants more flexibility for manufacturers and a more technology-neutral pathway to protect industrial competitiveness. Another insists Europe must maintain the pace of electrification to meet climate targets, reduce fossil fuel dependence, and give investors a stable signal.
Commission defends “balanced” proposal
The Commission urged ministers to keep sight of three objectives: decarbonising transport, boosting competitiveness, and reducing dependence on fossil fuels. “The proposal sends a strong signal to the industry and gives manufacturers more technological options to meet the targets cost effectively,” Commissioner Wopke Hoekstra said.
He also argued that market developments strengthened the case: EV drivers today benefit from fuel cost savings of 35 per cent relative to a year ago, and fully electric vehicles have already cut EU fossil fuel import costs by around €4.5 billion annually. Electric vehicles now account for 20 per cent of new car sales in the EU year to date, with sales rising year on year in Germany, Italy, France, and Spain. The Commission also stressed the role of small, EU-made battery electric vehicles in widening consumer uptake and supporting European jobs.
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Electrification camp warns against delay
Countries including Sweden, Spain, France, Portugal, Luxembourg, and the Netherlands backed an unambiguous path to electrification. Sweden argued that the e-fuels review must not prompt the EU to reverse or delay investments already made under current fuel standards. The 2035 targets should remain unchanged, it said, and flexibility should be very limited. Sweden also criticised the introduction of fuel credits, warning they would divert sustainable biofuels to road transport, raise costs, and slow electrification.
Spain cautioned against “backpedalling.” It stressed the need to maintain a clear investment signal for manufacturers and consumers already committed to electric vehicles.
France was more blunt. Europe has already invested more than €200 billion in batteries, electric vehicles, and charging infrastructure, and must keep moving in that direction for climate, industrial, and economic reasons. Paris also warned that alternative fuels are not equivalent to electricity in terms of emissions reductions or purchasing power.
Luxembourg and the Netherlands opposed including cars running on renewable or carbon-neutral fuels in the definition of zero-emission vehicles, arguing such fuels should be reserved for sectors with no viable alternative — aviation, defence, and shipping.
Flexibility camp calls for technology neutrality
Other member states raised concerns that an electrification-only approach risked deepening Europe’s reliance on imported batteries and critical raw materials.
Czechia argued against the 2035 deadline and sought to reopen the 2030 target, saying billions in fines levied on the European car industry would be better spent developing new technologies and easing the energy transition. Prague also noted that the EU automotive sector represents more than 8 per cent of EU GDP and employs 13.6 million people.
Italy said electric vehicles would play a major role but argued Europe should not build its automotive future around a single technology. Rome called for recognition of vehicles powered by renewable fuels — not as a weakening of ambition, it said, but as an alternative route to EU climate goals.
Poland, Slovakia, and Bulgaria pushed for greater technological neutrality and more flexibility for manufacturers, including recognition of renewable and synthetic fuels.
Key disputes still unresolved
The debate showed that several technical issues have become politically sensitive. These include the conditions attached to the 2030 and 2035 targets, how to treat emissions remaining below the proposed 90 per cent threshold for 2035, whether cars running on carbon-neutral fuels should count as zero-emission vehicles, and how fuel credits would work in practice. Ministers also divided over the plug-in hybrid utility factor: whether to update it to better reflect real-world driving emissions, or freeze it pending a full review.
Electric vehicles have represented 20 per cent of new car sales in the European Union year to date.
— Wopke Hoekstra, European Commissioner
The super credits for small affordable EVs, green steel credits, and a potential “made in EU” requirement also proved contentious. Some countries backed incentives for European-made electric vehicles; others raised concerns about supply chain disruption and called for clearer definitions. The Commission and presidency also addressed the question of what constitutes a European product more broadly.
The presidency acknowledged that views remain “quite diverging” on the level of ambition and the proposed flexibilities, especially fuel credits. The incoming Irish Presidency will now be asked to build a balanced compromise, and with billions in potential fines and millions of jobs at stake, the pressure to find one will only grow.
