The European Commission today formally proposed new legislation granting car manufacturers more flexibility in meeting their 2025 CO₂ emissions reduction targets, in a move designed to support the auto industry through its green transition while maintaining Europe’s climate commitments.
Under the proposed amendment to existing EU regulations, carmakers will now be allowed to average their emissions performance over a three-year period — from 2025 to 2027 — rather than being assessed on an annual basis. This change, the Commission said, is aimed at helping manufacturers better manage fluctuations in production and investment as they shift towards cleaner technologies.
The proposal forms part of the Commission’s Industrial Action Plan for the European Automotive Sector, unveiled on 5 March 2025. It follows months of dialogue with stakeholders, including a public consultation and the Strategic Dialogue on the Future of the Automotive Industry, launched by Commission President Ursula von der Leyen earlier this year.
“Our highly innovative automotive industry is decarbonising to contribute to the fight against climate change, but also to maintain its competitive edge on the world markets,” said President von der Leyen in a statement.
“With today’s initiative, we grant more flexibility to this key sector, and at the same time we stay the course of our climate goals. Together, we want to prove that decarbonisation and competitiveness can go hand in hand.”
By allowing performance to be averaged across three years, the Commission hopes to give carmakers the room to recover from any short-term setbacks, such as supply chain disruptions or delayed model rollouts, while still incentivising long-term reductions in emissions.
Importantly, the 2025 CO₂ reduction targets themselves remain unchanged, underscoring the EU’s commitment to its broader climate strategy, which aims for net-zero emissions from road transport by 2050. The new measure is expected to offer manufacturers a more stable planning horizon for investing in zero-emission vehicle technologies.
The Commission is urging the European Parliament and Council to adopt the amendment swiftly, emphasising the need to provide regulatory certainty to both industry and investors.
Sigrid de Vries, Director General of the European Automobile Manufacturers’ Association (ACEA), agreed stating: “We call on the European Parliament and Council to ensure the fast adoption of this amendment.”
“The next important step is then to thoroughly assess the transformation’s overall progress, with a focus on refining the approach – not the end goal – where necessary. This is no less important for the commercial vehicles sector: with zero-emission trucks accounting for only 2% of all new registrations, this vehicle segment urgently needs an acceleration of the review of its CO2 standards to 2025, too, based on an assessment of the sectors’ enabling conditions,” added de Vries.
