The European Parliament is considering a further relaxation of the 2035 ban on internal combustion engine vehicles. A new compromise reached by key political groups proposes reducing the average CO2 emissions for new passenger cars by 87.5% compared to 2021 levels, a shift from the previously discussed 90% target.
Under the proposed agreement, automakers could earn emission credits by utilizing low-carbon steel produced within the EU. This mechanism is intended to provide a pathway for certain gasoline and hybrid vehicles to remain on the market after the 2035 deadline, offering more flexibility than the original zero-emission mandate.
While the 2023 regulation currently mandates a 100% reduction in CO2 emissions for new passenger and light commercial vehicles by 2035, the legislative landscape is evolving. The European Commission previously suggested a 90% target in December 2025, but the latest parliamentary proposal seeks to lower the threshold further.
The current 100% emission reduction target remains legally binding until new legislation is finalized. The latest agreement still requires formal confirmation from the involved political groups and subsequent negotiations between the European Parliament and EU member states before it can be enacted into law.
