EU May Delay 2035 Combustion Engine Phase-Out Proposal

EU Commission Considers Delay to Automotive Package Amid German Pressure

The European Commission is reportedly considering a delay to its crucial automotive regulatory package, which includes the implementation details for the 2035 combustion engine phase-out, according to multiple sources. The proposal, originally scheduled for release on December 10, 2025, may now be pushed back to early January as the Commission works to address concerns from Germany and other member states.

German Pressure for More Flexible Approach

German Chancellor Friedrich Merz has been leading a push to modify the EU's approach to the 2035 deadline. In a letter to the Commission, Merz advocated for allowing 'highly efficient combustion engines' beyond 2035 and called for continued approval of hybrid vehicles alongside fully electric cars. 'We want to create an automotive package that will be comprehensive,' EU Transport Commissioner Apostolos Tzitzikostas told Handelsblatt. 'We are open to all technologies.'

The German position reflects concerns from Europe's largest automotive industry, which produces approximately 20% of EU cars. Industry leaders have warned that a strict 2035 cutoff could harm competitiveness, particularly against Chinese automakers who are rapidly expanding in the European market.

Commission's Balancing Act

Commissioner Tzitzikostas indicated that any delay would be measured in weeks rather than months. 'It could be delayed... and that's for a good cause,' he stated, emphasizing the need for comprehensive regulations that consider multiple technological pathways.

The Commission is examining several key elements, including:

• The role of cleaner fuels such as advanced biofuels and e-fuels
• Potential EU production quotas for electric vehicles
• Incentives for corporate fleets to transition to electric vehicles
• Geopolitical considerations regarding European competitiveness

According to ESG News, the Commission may allow traditional combustion engines after 2035 if they run exclusively on zero-emission or low-emission fuels.

Background: The 2035 Phase-Out

The EU's 2035 combustion engine phase-out is a cornerstone of the bloc's Fit for 55 climate package, which aims to reduce greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels. The regulation effectively bans the sale of new petrol and diesel cars from 2035, requiring all new vehicles to be zero-emission.

However, the policy has faced increasing scrutiny as practical challenges emerge. A Reuters report highlights growing concerns about the feasibility of the 2035 deadline, particularly regarding charging infrastructure, battery supply chains, and consumer affordability.

Industry and Environmental Reactions

The potential delay has drawn mixed reactions. Environmental groups have expressed concern that any softening of the 2035 target could undermine Europe's climate leadership. 'This represents a major test of Europe's ability to balance climate ambition with industrial resilience,' noted one industry analyst speaking to ESG News.

Meanwhile, automotive industry representatives have welcomed the Commission's reconsideration. 'We need a broader technology mix to maintain competitiveness,' argued a spokesperson for German automakers, who have been particularly vocal about the need for hybrid technologies as a bridging solution.

The Commission has declined to comment officially on the potential delay, noting it is still reviewing member state contributions before deciding on next steps. However, sources indicate that the 'automotive package' legislation is now expected in early January rather than mid-December.

What's Next for European Automotive Policy

The upcoming decision will have significant implications for Europe's automotive industry, climate goals, and global perceptions of EU climate policy. The Commission faces the delicate task of maintaining ambitious climate targets while ensuring economic viability and social fairness in the transition.

As Commissioner Tzitzikostas emphasized, the goal is to create regulations that support European industry while advancing climate objectives. The final package is expected to address not only vehicle emissions but also broader issues including charging infrastructure, battery production, and international competitiveness.

The delay, while potentially frustrating for some stakeholders, reflects the complexity of transforming one of Europe's most important industrial sectors while maintaining global leadership in automotive technology.