EU reaches deal for ban on new combustion-engine cars from 2035

BRUSSELS -- The European Union reached a deal to effectively ban new combustion-engine cars from 2035, a move that will reshape transportation and mark a significant step on the path to reduce carbon emissions.

The EU's three key institutions -- its executive arm, the parliament and member states -- agreed to a deal on Thursday that will require automakers to reach a zero-emission target by 2035. 

The decision means that new gasoline and diesel cars will not be registered for use on the region's roads after 2035. It will speed up the switch to full-electric vehicles.

The deal also included a 55 percent cut in CO2 emissions for new cars sold from 2030 versus 2021 levels, much higher than the existing target of a 37.5 percent reduction by then.

"It's the start of a big transition of the European Union," said Jan Huitema, the parliament's main negotiator.

The deal marks an unexpectedly rapid advance for what was one of the EU’s most controversial proposals when it was announced a year ago as part of a green overhaul of the bloc's economy. And it marks the death knell, at least in Europe, for a mode of transport that has dominated the region since it was invented in the 19th century.

"European carmakers are already proving they are ready to step up to the plate, with increasing and increasingly affordable electric cars coming to the market," the EU's climate chief, Frans Timmermans, said in a statement. "The speed at which this change has happened over the past few years is remarkable."

The agreement has global ramifications. As the world's largest trade bloc, the EU has a reputation for setting standards globally and is home to many some of the biggest car manufacturers.

Volkswagen, Stellantis, Ford, Bentley and Jaguar are among automakers that have said they will stop selling gasoline and diesel cars in Europe by 2035 or before.

There are few exceptions to the new rules. Both the council and parliament agreed that niche manufacturers -- including Lamborghini -- which produce a small number of vehicles will receive a 1-year delay on the emissions targets.

A non-binding element favored by member states that calls on the commission to propose registering vehicles running exclusively on carbon-neutral fuels after 2035 was included in the final deal.

'Havana effect' fear

"We are now keen to see the framework conditions which are essential to meet this target reflected in EU policies,” said Oliver Zipse, president of ACEA, the European automakers lobby group and CEO of BMW.

"These include an abundance of renewable energy, a seamless private and public charging infrastructure network, and access to raw materials," Zipse said.

The regulation will be the first to be approved under the EU's green plans, known as "Fit for 55," which aims to cut greenhouse gas emissions by 55 percent this decade. Other policies include a major overhaul of the bloc's carbon market, as well as measures to spur renewables and energy efficiency.

Some groups criticized the deal, suggesting it could lead to a buildup over time of older emissions-spewing cars rather than new generations of potentially more efficient ones.

"With today’s agreement, a 'Havana effect' is becoming more realistic," Jens Gieseke, a lawmaker and negotiator from the conservative European People’s Party, said in a statement. "After 2035, our streets might become full of vintage cars, because new cars are not available or not affordable. Today's deal slammed shut the door to new technological developments and put all the eggs in one basket. This is a mistake."

Green campaigners welcomed the ban, which will see the EU become the largest economy to phase out sales of polluting vehicles. Cars and vans are responsible for 16 percent of all greenhouse gas emissions in Europe, the Brussels-based environmental lobby group Transport & Environment (T&E) group said.

"The days of the carbon spewing, pollution belching combustion engine are finally numbered. It's 125 years since Rudolf Diesel revolutionized engine efficiency, but lawmakers have decided the next chapter will be written by the cleaner, better electric vehicle. For the planet and human health, that can’t come fast enough," said Julia Poliscanova, senior director for vehicles and emobility at T&E.

There is a push to ban combustion engine cars completely in the U.S. California adopted plans in August to mandate a gradual phasing out of vehicles that run on combustion engines, with only zero-emission cars and a small portion of plug-in hybrids allowed by 2035. That move will ripple beyond the Golden State, as the rule will likely be adopted by 15 other states that have signed onto California’s existing zero-emission vehicle program.

Reuters contributed to this report