by supplychainreport
The European Union has signaled a major shift in its climate and industrial strategy by proposing changes to its planned 2035 phaseout of new combustion-engine vehicles, following sustained pressure from member states and the automotive supply chain.
Under the revised proposal, the requirement for all new cars and vans sold from 2035 to achieve zero emissions would be softened. Instead, manufacturers would be required to cut carbon dioxide emissions by 90% from 2021 levels, rather than eliminating them entirely. The change would allow the continued sale of certain non-fully electric vehicles, including models that still rely partly on fuel-based technologies.
Supply Chain Concerns Drive Policy Adjustment
The proposal reflects mounting concerns across Europe’s automotive supply chain, where manufacturers, parts suppliers, and materials producers are grappling with rising costs, uneven electric vehicle demand, and intensifying competition from overseas producers. Industry stakeholders argue that maintaining some flexibility is necessary to protect jobs, stabilize production networks, and preserve industrial competitiveness during the transition.
To meet the revised emissions targets, automakers would be allowed to offset remaining emissions by using lower-carbon materials produced within the EU, as well as alternative fuels such as synthetic e-fuels and advanced biofuels derived from agricultural waste and used cooking oil. These measures are intended to support decarbonization across upstream supply chains, including steel, energy, and fuel production.
Adjusted Timelines and Emissions Targets
The plan also introduces a transitional window from 2030 to 2032, during which carmakers would be required to reduce emissions by 55% from 2021 levels. Targets for commercial vans would be eased, lowering the 2030 reduction requirement from 50% to 40%. These adjustments are designed to give manufacturers additional time to adapt production lines, secure critical raw materials, and scale clean technology supply chains.
If approved by EU governments and the European Parliament, the changes would represent the bloc’s most significant rollback of green transport policies introduced over the past five years.
Debate Over Competitiveness and Clean Transition
While industry groups have welcomed the added flexibility, clean transport advocates warn that weakening emissions targets could slow investment in electric vehicle infrastructure and battery supply chains. They caution that Europe risks falling further behind global competitors that are rapidly scaling clean mobility ecosystems.
At the same time, EU policymakers emphasized plans to accelerate electric vehicle adoption in corporate fleets, which account for roughly 60% of new vehicle sales in Europe. The Commission also outlined proposals for a new regulatory category for small electric vehicles, subject to lighter compliance rules and eligible for additional credits if produced within the EU.
As Europe balances climate goals with industrial resilience, the revised policy underscores the growing influence of supply chain realities in shaping the future of the region’s transport and manufacturing sectors.
#BreakingNews #NewsUpdate #SupplyChainNews #GlobalTrade #EUIndustry
