European Commission proposes easing 2035 combustion‑engine production ban

European Union officials on Tuesday introduced a proposal to revise the bloc’s law requiring carmakers to stop producing gasoline- and diesel-powered cars by 2035, replacing a zero-emissions requirement with a 90 percent cut that would allow hybrids and internal-combustion vehicles to be made after the deadline.

The move follows intense lobbying by Europe’s automobile industry amid declining sales in China, plunging profits and job losses. Germany’s chancellor, Friedrich Merz, has led the push to ease the rules, joined by Italy, Poland, the Czech Republic, Hungary, Slovakia and Bulgaria. Analyst Matthias Schmidt said premium brands such as Porsche, Mercedes‑Benz and BMW "would most likely benefit the most," while mass-market makers like Volkswagen and Stellantis might pivot to electric vehicles faster because of Chinese competition.

The commission’s proposal would allow emissions to be offset through the use of low‑carbon steel produced within the bloc or from e‑fuels and biofuels, includes incentives for compact European-made electric cars, and — the commission said — would cut red tape to save the auto industry 706 million euros a year.

The change is described as part of a wider rollback of climate and reporting rules, and the article notes recent U.S. policy shifts and industry reversals that have influenced the global market. Changing the ban would require approval by the EU’s 27 member states and the European Parliament.

Key Topics

Business, European Commission, European Union, Friedrich Merz, Bmw, E-fuels