Brussels: The European Commission today announced the release of a comprehensive Automotive Package aimed at facilitating the automotive sector's transition to clean mobility. The initiative outlines a strategic framework to achieve climate neutrality by 2050 and enhance Europe's industrial competitiveness, responding to industry demands for simplified regulations.
According to Cyprus News Agency, the automotive sector has been a cornerstone of Europe's industrial prowess, supporting millions of jobs and fostering technological advancements. However, the sector is undergoing a transformation driven by new technologies and emerging players. The newly presented package emphasizes zero-emission vehicles (ZEVs) and provides manufacturers with increased flexibility to meet CO2 targets. The package also promotes vehicles and batteries produced within the EU.
The package introduces several measures, including a corporate vehicles initiative to boost the adoption of zero- and low-emission vehicles and an automotive omnibus to enhance competitiveness by saving costs and reducing bureaucratic hurdles. This omnibus is expected to save manufacturers approximately £706 million annually, providing greater investment certainty.
Commission President Ursula von der Leyen emphasized the significance of innovation, clean mobility, and competitiveness as top priorities in discussions with the automotive sector and other stakeholders. She stated that Europe remains a leader in the global clean transition amid rapid technological changes and geopolitical shifts.
The package addresses both supply and demand aspects of the automotive sector's transition. On the supply side, it reviews existing CO2 emission standards for cars and vans and proposes targeted amendments for heavy-duty vehicles. On the demand side, it introduces initiatives to decarbonize corporate vehicles with binding national targets for zero- and low-emission vehicles.
From 2035, car manufacturers must achieve a 90% reduction in tailpipe emissions, with the remaining 10% to be compensated through low-carbon steel or sustainable fuels. This approach allows for the continued role of plug-in hybrids, range extenders, mild hybrids, and internal combustion engine vehicles beyond 2035, alongside full electric and hydrogen vehicles.
Prior to 2035, manufacturers can earn 'super credits' for producing small affordable electric cars within the EU, incentivizing the market deployment of such models. Additional flexibility is granted for vans, with a reduction in the 2030 CO2 target from 50% to 40%.
The Commission also proposes amendments to CO2 standards for heavy-duty vehicles and sets mandatory targets for corporate vehicles at the Member State level to encourage the uptake of zero- and low-emission vehicles by large companies. This approach is expected to benefit both first- and second-hand markets.
The Battery Booster initiative aims to accelerate the development of a fully EU-made battery value chain with £1.8 billion in funding. This includes £1.5 billion in interest-free loans for European battery cell producers. The initiative seeks to enhance cost competitiveness, secure supply chains, and ensure sustainable production in the EU.
The Automotive Omnibus aims to reduce administrative burdens, cutting costs for manufacturers, and supporting the transition to electric transport. The omnibus also creates a new vehicle category under the Small Affordable Cars initiative, covering electric vehicles up to 4.2 meters in length, enabling targeted incentives for small EVs made in the EU.
The Commission is committed to updating and harmonizing car labeling rules to provide customers with comprehensive information about vehicle emissions. These proposals build on the Automotive Action Plan and insights from industry and stakeholders gathered during the Strategic Dialogue initiated by President von der Leyen in January 2025.
For more information, the Commission has released a series of factsheets and a dedicated webpage on the Automotive Package and Action Plan.