On 14 February 2023 the European Parliament voted that, from 2035, new cars and vans must emit no CO2. EU governments must still give formal approval. What it means for manufacturers, dealers and fleets.
On 14 February 2023 the European Parliament approved, in Strasbourg, the regulation setting new CO2 emission targets for new cars and vans. The text passed with 340 votes in favour, 279 against and 21 abstentions, and confirms the agreement reached with member states under the “Fit for 55” package, through which the European Union aims to cut its net greenhouse gas emissions by at least 55% by 2030 compared with 1990.
What the rule says
From 2035, the CO2 emissions of new cars and vans sold in the European Union must be 100% lower than in 2021; in other words, zero. In practice, that rules out registering new petrol or diesel vehicles. As an interim step, the cut required in 2030 will be 55% for cars and 50% for vans, compared with the 37.5% and 31% set by the previous rules.
There are exceptions. Small manufacturers, those selling between 1,000 and 10,000 new cars or between 1,000 and 22,000 new vans a year, may benefit from a derogation until the end of 2035, and those registering fewer than 1,000 vehicles a year are exempt.
The rule covers only new vehicles. It does not take existing combustion-engine cars off the road, nor does it stop them being sold second-hand.
What it means for the industry
For manufacturers, the timetable is long, but it forces decisions on how many combustion platforms to keep developing and how many factories to convert. In 2022, 12.1% of new cars registered in the EU were fully electric, 3 percentage points more than a year earlier; petrol cars accounted for 36.4% and diesels for 16.4%, according to the European industry association (ACEA). Spain is a major manufacturer: according to ANFAC, it produced 2.2 million vehicles in 2022 and exported 1.9 million, almost 85% of the total, so what is decided in Brussels matters to plants and suppliers here.
For dealers and workshops, the change is one of business model: selling and servicing electric vehicles means training staff, installing charging points and rethinking aftersales, because these vehicles generally need less maintenance. Combustion-engine cars will still be sold until 2035, and those already on the road will need servicing for years.
For companies with fleets, what matters is the renewal cycle. A vehicle bought in 2030 may still be a combustion-engine one; one bought in 2035 may not. It is worth reviewing rental and leasing contracts, expected residual values, charging availability at offices and along regular routes, and purchase incentives, which depend on each country and each administration. Ask your adviser how it applies to you.
What is still to come
The text still needs the formal approval of the Council, which represents the member states, and publication in the Official Journal of the European Union before it enters into force. The regulation also provides for reviews: the Commission must present, before 2025, a method for measuring the emissions of cars and vans over their whole life cycle; from the end of 2025 it will publish a report every two years on progress towards zero-emission road mobility; and before December 2026 it will monitor the gap between type-approval emissions and real-world consumption.
The date is far off, but the industry’s investments are planned years ahead.
This article is general information. It is not legal, tax or investment advice, and it does not take anyone’s particular circumstances into account.
