Overview
The European Union is considering shifting from a full ban on new gasoline car sales to a 90% reduction in car-related CO2 emissions by 2035, according to The Drive. The proposal would replace the previously planned 100% cut and still requires approval from EU governments and the European Parliament.
What Changed
- Moves from a 100% CO2 cut to a 90% fleet-average target by 2035.
- Allows limited volumes of internal-combustion or hybrid vehicles post-2035 if offset by high zero-emission sales.
- Builds on the 2023 pathway allowing certain carbon-neutral e-fuels in narrow cases beyond 2035.
Why the Shift
- A more pragmatic phase focused on consumer adoption, industrial competitiveness, and charging-network readiness.
- Viewed by some as potentially advantageous for Chinese automakers in Europe, which could affect market dynamics.
Implications for EU Dealers
Because compliance is measured at the manufacturer fleet level, dealers execute strategies set upstream. Likely impacts include:
- Product availability and mix: Limited ICE or plug-in hybrid allocations may persist after 2035, requiring granular allocation and balancing tools.
- Pricing and incentives: More targeted, time-bound EV promotions and financing to quickly shift sales mix.
- After-sales and service: A longer runway for combustion models may temper the pace of change, but investment in high-voltage training and EV service remains essential.
- Infrastructure and facilities: Continued need for dealership charging and staff EV education, with potentially phased investment schedules.
What Stays the Same
- Automakers still need very high zero-emission shares by 2035 to comply.
- Dealers must prioritize EV product knowledge, customer education, charging guidance, and total cost of ownership explanations.
- Pressure remains on manufacturers to deliver profitable, mainstream EVs, influencing dealer margins and throughput.
Market Dynamics
The recalibration is seen by some as potentially benefiting Chinese EV brands, which could influence pricing, turn rates, and used-vehicle valuations. Effects will vary by brand relationships and whether markets use franchise or direct-to-consumer models.
Legacy Model Sequencing
A 90% fleet reduction may leave room for niche or specialty ICE models to continue in low volumes, supported by strong EV sales elsewhere. This can help maintain relationships with customers not ready to fully switch and smooth inventory planning.
Process and Timing
- The package needs sign-off by EU governments and the European Parliament.
- Final text will define targets, crediting, and any carve-outs, followed by detailed implementing rules.
- Automakers will then cascade product plans and retail targets; dealers will receive guidance via national distributors and brand teams.
Global Context
The move comes amid ongoing debates over EV timelines elsewhere, including in the United States. Multinational automakers often align global product cycles with the strictest or most commercially significant standards, shaping what reaches European showrooms and when.
Bottom Line for Retailers
2035 looks less like an absolute cutoff and more like a hard cap that still requires an overwhelming pivot to zero-emission vehicles. Dealers should refine EV sales proficiency, manage a shifting mix, and adapt service operations—now with a somewhat broader lineup and more flexibility on timing.
