Germany and France are preparing to propose that carmakers cut fleet CO₂ emissions by 90 per cent by 2035, instead of the currently planned 100 per cent — and with no requirement to offset the remaining emissions. The figure comes from excerpts of a preliminary agreement paper between the two governments, obtained and reported on 12 October.

The paper also points to stricter "Made in Europe" requirements. Together, the two positions amount to an attempt by Europe's largest car-producing nations to reshape the EU's so-called 'Auto Package' — the bloc's bundle of vehicle-industry legislation now under revision.

What would the 90 per cent figure change?

Under the current EU framework, new cars sold from 2035 must emit effectively zero grams of CO₂ per kilometre on a fleet-average basis (the average across everything a manufacturer sells in a given year). In practice, that rule bans the sale of new purely combustion-engine cars from that date.

A 90 per cent target works differently. It leaves a 10 per cent residual slice of emissions that manufacturers could still produce — and, according to the draft paper, without any obligation to offset that remainder through compensatory measures. For a carmaker, that residual share could translate into continued production of combustion or hybrid vehicles in limited volumes, rather than a hard stop.

The distinction matters for plant planning. A 100 per cent target forces full electrification of new-car output; a 90 per cent target leaves engineering and line allocation decisions to each manufacturer's fleet mix.

Who is behind the proposal?

The initiative sits with the German and French governments, not with the European Commission. The two countries are the EU's two largest car markets and host the bulk of its vehicle production capacity, which gives their joint position significant weight in Brussels negotiations.

The document is a preliminary agreement paper — a negotiating position, not adopted legislation. EU member states and the European Parliament would still need to approve any change to the 2035 CO₂ regulation before it takes effect.

Why pair the target with "Made in Europe" rules?

The draft links the emissions concession to stricter European content requirements. The pairing suggests a trade: a softer CO₂ obligation in exchange for commitments that keep more vehicle and component production inside the EU.

For suppliers, stricter local-content rules could affect sourcing decisions across tiers — from battery cells to drivetrain components. The paper's excerpts do not yet specify how the "Made in Europe" threshold would be defined or measured, a detail that will determine its real impact on supply chains.

Is the proposal confirmed policy?

No. Several steps separate this paper from law:

• The Franco-German position is preliminary and drawn from excerpts of a draft agreement.
• The European Commission must table revised legislation within the Auto Package process.
• Member states and the European Parliament must both sign off on any final text.

The 90 per cent figure should therefore be read as a negotiating anchor from two governments, not as a decided outcome. Previous Franco-German interventions in EU auto policy have shifted final texts, but rarely in full.

What to watch next

Watch for the formal tabling of the Franco-German position within the Auto Package discussions, and for the Commission's response on whether it will amend the 2035 target. The definitional detail of the "Made in Europe" requirement — its content threshold and measurement method — will be the clause suppliers and plant managers should read most closely.