The EU Nears Decision Allowing Combustion Engines Beyond 2040

If there’s one word that immediately springs to mind in the context of the European Union, it’s definitely “regulation.” Automakers are continually constrained by increasingly stringent guidelines they must meet to sell their cars. Ever-tighter fleet emissions targets are burdening manufacturers, forcing them to prioritize EVs, which have notoriously low profit margins, if any.

But a light at the end of the tunnel is starting to appear. Earlier this month, the European Union’s Commissioner for Sustainable Transport and Tourism announced that sales of new cars with combustion engines would still be allowed after the originally imposed 2035 cutoff date. We’re now learning that ICE is likely to stick around even longer, continuing into the 2040s.

German newspaper Bild quotes Manfred Weber, the head of the European People’s Party (EPP), saying the de facto ban on combustion engines is going away indefinitely. The following agreement was reached during a late-night meeting this week, with further details finalized yesterday, December 11:

‘For new registrations from 2035 onwards, a 90-percent reduction in CO₂ emissions will now be mandatory for car manufacturers’ fleet targets, instead of 100 percent. There will also be no 100-percent target from 2040 onwards. This means that the technology ban on combustion engines is off the table. All engines currently built in Germany can therefore continue to be produced and sold.’

Photo by: Mercedes-Benz

In a statement to Automobilwoche, a spokesperson for Manfred Weber confirmed the agreement reached between Commission President Ursula von der Leyen and the leader of the EPP group. By the way, the EPP is the largest and most influential in the European Parliament. The official announcement from the EU Commission is expected to come as early as next Tuesday, December 16.

The original regulation required all new cars sold from the middle of the next decade in the EU’s 27 member states to be entirely CO₂-free. Under the new, more relaxed target with a 90-percent reduction, car manufacturers would have more leeway. For example, the remaining 10 percent gap would allow them to keep combustion engines alive in plug-in hybrids. Additionally, EVs equipped with a range-extending gas engine serving as a generator to charge the battery would also be permitted.

Photo by: BMW

Manfred Weber’s statement that regulators won’t impose a 100-percent emissions reduction target for 2040 is a clear sign that the EU has realized the original ban was rushed. With a few exceptions, such as Volvo and Polestar, most automakers have strongly opposed the 2035 cutoff date set earlier this decade. It’s increasingly likely their persistent pressure is paying off.

Whatever Europe decides will have global ramifications. All major automakers sell cars in the EU, and keeping combustion engines in production means customers in non-EU countries will also benefit from greater powertrain diversity. The ability to sell ICE-powered cars in such an important market allows manufacturers to maintain economies of scale and keep engine factories running, preserving hundreds of thousands of jobs in the process.

Sources:

Bild, Automobilwoche