ACEA reiterates need for realistic reform of cars and vans CO2 reduction policy

Brussels, 22 October 2025 - Responding to the statement made by France and Spain during the Environment Council earlier this week, ACEA cautions that the proposed policy approach falls short of providing the lasting and impactful solutions the EU needs to bring together its decarbonisation, resilience, and competitiveness objectives.

With the present battery-electric vehicle market share of less than 16% for passenger cars and less than 9% for vans, both the 2030 and 2035 CO2-reduction targets for light-duty vehicles cannot be achieved. A pragmatic, flexible, and technology-neutral approach is needed to accelerate the transformation and safeguard investments and jobs in the European Union.

The French-Spanish paper acknowledges that the automotive sector is facing a slower-than-expected growth in electric vehicle sales and recognises the need for flexibilities. Yet it refrains from applying full technology neutrality also beyond 2035. Additionally, ACEA recognises the need for a competitive and sustainable automotive value chain in Europe and is looking into this subject. The suggestion to link flexibilities strictly to production efforts in Europe ignores the complexity of supply chains, the time needed to ramp up battery manufacturing in the EU, and the need to bring affordable vehicles to European citizens already now.

When it comes to vans, apart from a five-year averaging mechanism, a change of the 2030 target is needed to prevent disproportionate costs of non-compliance, which would further undermine the van manufacturers' ability to re-invest into the transformation. This vehicle segment is key to many small businesses who currently hesitate to transition to zero-emission vehicles due to higher costs of ownership, reduced payload of battery-electric vans, and lack of dense fast charging infrastructure.

Auto makers remain fully committed to the 2050 climate neutrality goal. They are heavily invested in electrification as the main pathway to decarbonising transport. Yet the reality on the ground is proving far more complex: the supporting ecosystem (infrastructure, incentives, battery value chain development) and consumer demand can't follow the pace set by the zero-emission tailpipe target - even though the range of available and more affordable electric vehicles (EVs) is constantly growing.

What we call for is a more realistic and pragmatic recalibration of the post-2035 regime based on three pillars:

• Doubling down on the enabling conditions for electrification: revising the CO2 Regulation alone will not decarbonise road transport. Stronger infrastructure targets, grid investments, regulatory reforms for vehicle-to-grid integration, and sustained demand incentives are critical to make electric vehicles both practical and economically attractive.
• Link the decarbonisation targets for vehicles to two other critical dimensions - competitiveness and resilience. Adopt a tailored approach to vans, which operate under different conditions than passenger cars.
• Technology neutrality: allow all drivetrain technologies (eg PHEV, range extenders, hydrogen fuel-cell, etc), which can play a viable role to reduce emissions on the roads. Additional emissions coming from a small share of non-BEV vehicles can be compensated through various levers, such as car parc renewal, a higher share of decarbonised fuel, or reducing emission in the supply chain (eg by using low-carbon steel or aluminum or higher share of recycled materials in auto manufacturing), carbon removals, etc.

About ACEA

• The European Automobile Manufacturers' Association (ACEA) represents the 16 major Europe-based car, van, truck and bus makers: BMW Group, DAF Trucks, Daimler Truck, Ferrari, Ford of Europe, Honda Motor Europe, Hyundai Motor Europe, Iveco Group, JLR, Mercedes-Benz, Nissan, Renault Group, Stellantis, Toyota Motor Europe, Volkswagen Group, and Volvo Group.
• Visit https://www.acea.auto for more information about ACEA, and follow us on https://www.x.com/ACEA_auto or https://www.linkedin.com/company/ACEA/

Contact:

• Camille Lamarque, Policy Communications Officer, [email protected], +32 (0) 2 738 73 16

About the EU automobile industry

• 13.6 million Europeans work in the automotive sector
• 8.1% of all manufacturing jobs in the EU
• €414.7 billion in tax revenue for European governments
• €93.9 billion trade surplus for the European Union
• Over 8% of EU GDP generated by the auto industry
• €84.6 billion in R&D spending annually, 34% of EU total