The Automotive Update: EU dilutes 2035 emissions targets and latest global EV growth analysis
19 December 2025
What were the major takeaways from the European Commission’s automotive package? How has the industry reacted to further vehicle emissions flexibility in the EU? Plus, are global electric vehicle (EV) sales increasing, or has momentum slowed? Autovista24 journalist Tom Hooker presents The Automotive Update podcast.
This latest episode dives into the key announcements from the European Commission’s new automotive package. Autovista24 explores how the various proposals, including more emissions leniency, could transform the future of car sales in the EU.
Subscribe to the Autovista24 podcast and listen to previous episodes on Spotify, Apple and Amazon Music.
Changes to EU ICE ban confirmed
The European Commission has presented an automotive package that could significantly alter the EU’s approach to vehicle emissions. Central to this, the package will allow new internal combustion engine (ICE) vehicles to be sold after 2035.
This confirms a distinct departure from the previous framework. The former legislation required all new cars and light commercial vehicles (LCVs) sold in the EU from that year to have zero tailpipe CO₂ emissions.
Instead, the proposal aims to provide greater flexibility in how manufacturers achieve emissions reductions amid longer-term climate objectives. The new package allows for new petrol and diesel models to be sold after 2035. The legislation also allows for new mild hybrids, full hybrids, plug-in hybrids (PHEVs), and extended-range electric vehicles, can be sold after that date.
Under the new framework, carmakers must reduce tailpipe CO₂ emissions by 90% compared with 2021 levels from 2035 onwards. Remaining emissions could be offset through the adoption of low carbon steel produced within the EU, as well as the incorporation of e-fuels and biofuels.
The package also proposes adjustments to interim emissions targets via a ‘banking and borrowing’ mechanism between 2030 and 2032. This would give manufacturers additional flexibility to meet the 2030 target of a 55% CO₂ reduction.
Rapid technology transformation
Additional measures include revised vehicle labelling requirements, plus expanding CO₂ and amended energy performance information. Mandatory zero and low-emission vehicle targets for corporate fleets would be set at a national level.
To support affordability and competitiveness, the package also introduced incentives aimed at smaller electric cars. There were also announcements for funding to strengthen the European battery chain. This includes significant support for battery-cell production.
‘Innovation. Clean mobility. Competitiveness. This year, these were top priorities in our intense dialogues with automotive sector, civil society organisations and stakeholders,’ said European Commission President von der Leyen.
‘Today, we are addressing them all together. As technology rapidly transforms mobility and geopolitics reshapes global competition, Europe remains at the forefront of the global clean transition,’ she outlined.
EV adoption upswing in Europe and beyond
Deliveries of EVs in Europe, including battery-electric vehicles (BEVs) and PHEVs, have grown by 27.8% across the first 10 months of 2025. In all, just over three million units were sold in the region.
BEVs recorded a smaller cumulative growth of 25.7%, with a higher overall delivery volume. Between January and October, the powertrain saw over two million vehicles take to Europe’s roads.
PHEVs have witnessed a greater year-on-year sales increase of 32.1% from January to October. This, however, is based on a smaller figure. Just over one million PHEV units were delivered.
Globally, the EV market grew by 28.8% year on year, across the first 10 months of 2025. This was driven by BEVs, which captured a 64.3% share of total plug-in sales. Conversely, PHEVs, saw slower growth. Hampered by China’s relatively receding market, the powertrain made up just over a third of all EV sales globally between January and October.
In China itself, PHEV growth reached 18.7%, over the first 10 months of 2025. Hampered by slow growth since July, this is, significantly down from its 84.1% improvement in the same period of 2024. However, the Chinese market saw overall EV sales increase by 29.1% from January to October, with BEVs driving this growth.
