On 15 December 2025, the European Commission set out proposals to revise its 2035 zero-emission vehicle mandate, signalling a shift in one of the bloc’s most high-profile climate policies.
Instead of requiring a 100 per cent reduction in CO₂ emissions from new cars and vans by 2035, the Commission is now proposing a 90 per cent fleet-wide reduction compared with 2021 levels. In practical terms, that change allows certain hybrids and combustion-engine vehicles running on approved low-carbon fuels to remain on sale beyond the original deadline.
The move reopens a debate many had considered settled.
The Scale of the Sector
Road transport is central to Europe’s climate strategy. It accounts for roughly 29 per cent of total EU greenhouse-gas emissions, and passenger cars alone represent about 16 per cent of overall CO₂ output. Within the transport sector itself, road vehicles generate close to three quarters of emissions.
That is why the 2035 target mattered. It was not symbolic. It was structural.
Battery electric vehicles typically produce around 70 per cent fewer life-cycle emissions than conventional petrol cars in the EU. The original requirement for a full 100 per cent reduction in tailpipe emissions was designed to accelerate that transition at scale.
A 90 per cent reduction still represents a substantial shift. It is not a rollback to business as usual. But it does create room for alternative compliance pathways.
Why the Commission Blinked
Pressure from member states and manufacturers has been building for months. Carmakers have argued that uneven charging infrastructure, slower-than-expected consumer uptake and intensifying global competition require greater regulatory flexibility.
Germany and Italy, both with significant automotive industries, have pushed for a framework that preserves industrial competitiveness while continuing to reduce emissions. The revised proposal reflects that balancing act.
Brussels is now attempting to maintain decarbonisation momentum without forcing a singular technological outcome.
What This Means for the Transition
For investors and industry planners, the key issue is certainty.
The original 2035 rule offered clarity. Manufacturers could plan supply chains, battery investments and production shifts around a fixed endpoint. The revised framework introduces nuance. It widens the pathway while preserving direction.
A 90 per cent reduction target still implies profound change across Europe’s car market. Internal combustion does not disappear, but it becomes constrained, conditional and increasingly marginal.
The question now is whether this flexibility strengthens the transition by making it politically durable, or weakens it by diluting long-term signals.
Either way, Europe’s route to decarbonised mobility looks less linear than it did a year ago.
