EU: ‘Historic’ deal to end sales tax on new cars with internal combustion engines from 2035

The European Union approved yesterday Thursday the death certificate for new vehicles with internal combustion engines in 2035: the MEPs and the governments of the member states reached an agreement on this rule, an emblematic measure aimed at meeting the European commitments for climate neutrality.

The French MEP Pascal Kanfen (Renew Europe), the chairman of the European Parliament’s Environment Committee, spoke of a “historic decision by the EU on the climate” via Twitter, after the completion of several hours of negotiations.

European Commission President Ursula von der Leyen welcomed this “crucial milestone” in the EU’s climate ambitions, which she said would “strengthen innovation and European industrial and technological leadership” ».

The European car industry assured that it is ready to “face the challenge” after this “unprecedented decision”, while calling on the EU to set “conditions” that it describes as necessary to achieve the goal, in particular the installation of an adequate network of chargers for the batteries of the electric cars.

The approved text is based on the proposal submitted by the Commission in July 2021 and foresees the zero CO2 emissions of new cars sold in Europe from 2035.

Which means the de facto end of sales of new petrol or diesel-burning light commercial vehicles in the European Union from this year, as well as hybrid cars (petrol or diesel + batteries), or in other words how they will be sold only 100% electric new cars.

As the car, the main means of transport for Europeans, accounts for just under 15% of the total CO2 emissions in the EU, the new rule is expected to contribute to the achievement of the old continent’s climate goals, namely the achievement of climate neutrality with a horizon of 2050.

This is the first agreement on a measure included in the European climate package (“Fit for 55”), which aims to reduce greenhouse gas emissions by 55% by 2030 compared to 1990. the EU member states.

It predicts a 55% reduction in carbon dioxide emissions in 2030 for new cars and 50% for new vans compared to 2021.

Exceptions are foreseen, in particular for car manufacturers that are characterized as “niche” (i.e. cover a specialized, small sector of the market) and those that produce fewer than 10,000 cars per year, until the end of 2035. This clause, also known as the “Ferrari amendment “, mainly concerns manufacturers of luxury and/or sports cars.

Negotiators also agreed to “begin the process of formulating a legislative proposal in 2025 to create a Just Transition Fund” for the automotive sector, Pascal Canfen added.

The creation of this fund was requested by the European Parliament to allow “to guarantee the comprehensive treatment of the social and economic costs” of the transition to “mobility with zero emissions”.

The European automotive industry employs, directly or indirectly, more than 13 million Europeans, in other words it accounts for 7% of jobs in the EU, according to the European Automobile Manufacturers Association (ACEA).

A Commission proposal is expected in 2023 that will allow the acceleration of corporate car fleets with zero-emission vehicles, explained Mr. Kanfen.

The European Parliament and the European Council will have to formally ratify this agreement for it to enter into force.

RES-EMP

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