EU Parliament relaxes emission standards for automobile producers - Car manufacturers receive approval from Parliament to loosen CO2 emission standards
The EU Parliament has softened the blow on tight emissions standards for carmakers, offering a more relaxed approach to compliance.
EU Commission President, Ursula von der Leyen, has thrown car manufacturers a lifeline: they can offset the CO2 emissions for their 2023 cars with the values of the following two years. This leeway applies to any shortfall in meeting the targets set for 2023. In essence, struggling manufacturers can make up for the deficit in emissions reduction in 2024 or 2025.
This proposal concerns the "fleet limits," regulations governing the average CO2 emissions that new cars sold by a manufacturer can emit. Each manufacturer has an individual limit, which is set to reach zero by 2035, spelling the end for new internal combustion engine cars.
Auto giants like Volkswagen and Renault are finding it tough to meet the tougher emission standards. They petitioned Brussels for more leeway to avoid hefty fines.
The 27 EU member states need to formally endorse the legislative change, but they signaled their support on Wednesday. Manufacturers also have another means of dodging penalties: they can form alliances with competitors called "pools," sharing an average emissions limit.
Far-right factions in the European Parliament proposed a reversal of the 2035 ban on internal combustion engines, but lacked the required majority. In the long run, even the European People's Party (EPP), including the CDU and CSU, has mooted ditching the combustion engine ban.
This move could fuel controversy in the new German government by the end of the year, as the SPD insists on sticking to the ban, while the Union is undecided.
The Big Picture:
- The EU Parliament's latest ruling on CO2 emissions for car manufacturers relaxes the timeline for compliance, allowing a three-year averaging period for emissions (2025-2027) to attain flexibility amid current industry challenges.
- The EU's overall climate commitments remain untouched; interim targets—such as 15% CO2 reduction by 2025, 55% reduction by 2030, and a complete ban on internal combustion engines by 2035—still stand.
- The decision provides short-term relief for carmakers while encouraging the continued transition towards electrification and supports the EU’s industrial action plan, promoting a balance between climate ambitions and economic competitiveness.
- The EU Commission President, Ursula von der Leyen, provided car manufacturers with a lifeline, allowing them to offset the CO2 emissions for their 2023 cars with the values of the following two years.
- This legislative change, concerning the "fleet limits," offers carmakers more flexibility by creating a three-year averaging period for emissions (2025-2027).
- The proposal comes as a response to the industry's struggles in meeting the tougher emission standards and the threat of heavy fines.
- The European Parliament, despite far-right factions' attempts to reverse the 2035 ban on internal combustion engines, signaled its support for the new regulation during Wednesday's session.
- The decision supports the EU’s industrial action plan, promoting a balance between the EU's climate ambitions and the need for economic competitiveness within the automotive industry.
- This move in the EU Parliament may stir debate in the new German government by the end of the year, with the SPD insisting on maintaining the ban, while the Union remains undecided on the matter.
