EU Parliament Eyes Softer 2035 CO2 Rules in Auto Package Deal

The 2035 de-facto ban on new combustion engines in the EU is on track for a partial walkback. According to media reports, the three factions of the European Parliament's so-called Center Platform have agreed on a compromise position that would relax the CO2 reduction requirements for cars inside the Auto Package.

A first committee vote on Thursday will show how stable that majority actually is. Committee arithmetic is where EU climate policy usually goes to be quietly resized.

What is actually on the table?

The deal concerns the Auto Package — the bundle of rules that includes the CO2 fleet limits effectively forcing new petrol and diesel cars off EU dealer lots from 2035. The reported compromise would water down those reduction targets rather than scrap them outright.

Key points as they stand:

• The 2035 combustion-engine phase-out would be softened, not abolished.
• Three centrist factions have reportedly agreed on a shared negotiating position.
• A first committee vote is scheduled for Thursday and will test the majority's durability.

That last bullet matters most. An agreed position among faction leaders is not a passed amendment. Thursday's vote is the first hard evidence of whether the compromise survives contact with the full committee.

Who said what?

The position rests on media reports rather than an official parliamentary statement, so treat the "agreed position" as a claim to verify. No faction leader has yet put their name to the final wording in public. What's confirmed is the timing: the committee vote is Thursday.

For automakers with EU plants — Volkswagen, Stellantis, Renault and the German premium trio among them — the difference between a softening and a full repeal is billions in powertrain investment already committed or deferred. Suppliers in tiers two and three, especially those retooling lines for EV components, hold the sharper end of that stick.

Why the 2035 date dominates

The 2035 deadline has been the anchor of EU automotive CO2 policy since lawmakers locked it in. Any relaxation shifts the planning horizon for every plant program in the bloc — battery gigafactory ramp-ups, combustion line retirements, and the tooling decisions that go with both.

A watered-down target wouldn't undo those programs overnight. It would, however, give OEMs room to stretch combustion production past dates they'd already circled, and that has knock-on effects for supplier contracts signed against the stricter timeline.

The takeaway: the EU's single hardest automotive deadline is now negotiable, and the negotiators have a draft.

What to watch next

Thursday's committee vote is the milestone. Watch the margin — a narrow win suggests the compromise gets picked apart in plenary; a comfortable one means the softened targets head toward negotiations with the Council and Commission.

After that, the plenary session and the trialogue talks will decide whether 2035 survives as a date or becomes a suggestion.