European automakers and suppliers say the EU’s CO² reducation framework needs reworked
The European Automobile Manufacturers’ Association (ACEA) and the Association of Automotive Suppliers (CLEPA) sent a letter to the European Commission saying that the industrial, economic, and geopolitical realities have changed, and so should the Commission’s current CO² reduction framework.
“As automotive manufacturers and suppliers, we are committed to helping the EU achieve the net zero goal in 2050,” the Aug. 27 letter says. “Together, we have launched hundreds of new electric vehicle models and committed to invest more than €250 billion towards the green transition by 2030. We want to make this transition work—but we’re frustrated by the lack of a holistic and pragmatic policy plan for the automotive industry’s transformation.”
The letter says the industry is being asked to transform with its hands tied behind its back due to Europe facing dependency on Asia for the battery value chain, an uneven distribution of charging infrastructure, and higher manufacturing costs, including electricity prices. It adds that the industry also faces tariffs from key trade partners, including a 15% duty on EU vehicle exports to the U.S.
Market share also continues to be low for battery-electric vehicles, the letter adds, with about 15% for cars, 9% for vans, and 3.5% for trucks.
“Some EU markets are showing signs of progress, but a large chunk of customers remain wary of switching to alternative powertrains,” the letter says. “Incentives are needed for European consumers and businesses to switch to electric vehicles, such as lower energy costs for charging, purchase subsidies, tax reductions, and access to urban space.
“Europe’s transformation plan for the auto industry must move beyond idealism to acknowledge current industrial and geopolitical realities. Meeting the rigid car and van CO2 targets for 2030 and 2035 is, in today’s world, simply no longer feasible. Instead, the current CO2 reduction path in road transport must be recalibrated to ensure it delivers on EU climate goals whilst also safeguarding Europe’s industrial competitiveness, social cohesion, and the strategic resilience of its supply chains.”
Streamlined EU regulations to cut red tape and long-term strategic partnerships with reliable global allies to reduce dependencies are needed to keep manufacturers and suppliers profitable and competitive, the letter says.
“The upcoming revision of the CO2 standards for cars and vans is an opportunity to correct the course and anchor in law much-needed flexibility, industrial perspective, and a market-driven approach,” the letter says. “It is clear by now that penalties and legal mandates alone will not drive the transition. Technology neutrality should be the core regulatory principle, which safeguards that technologies can contribute to decarbonisation. EVs will lead the charge, but there must also be space for (plug-in) hybrids, range extenders, highly efficient internal combustion-engine (ICE) vehicles, hydrogen, and decarbonised fuels.”
The Commission plans to hold a Strategic Dialogue on the future of the automotive industry on Sept. 12. The meeting can be used to change track.
“This is the EU’s last-chance saloon to adjust its policies for today’s market, geopolitical, and economic realities — or risk jeopardizing one of its most successful and globally competitive industries,” the letter says. “We share a common destination, yet the journey requires more pragmatism and flexibility to keep the motor of Europe’s automotive sector running.”
In the U.S., the One Big Beautiful Bill Act leaves CAFE standards in place and removes penalties on auto manufacturers for failing to meet them, ultimately making the law unenforceable.
In June, President Donald Trump also signed into law three Congressional Review Act (CRA) resolutions disapproving California vehicle emission waivers.
The U.S. House passed the reversal of the Environmental Protection Agency (EPA)’s approval of a waiver for California and 11 states to ban the sale of new gas-powered vehicles by 2035. Shortly after, the Senate approved the reversal.
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