European carmakers reported to be seeking 2-year delay on EV production targets

The European Automobile Manufacturers' Association (ACEA) is reportedly poised to urge the European Union (EU) to delay its 2025 electric vehicle (EV) production and emissions targets by two years.

ACEA is calling on the EU Commission to invoke Article 122 in the EU treaties – last used for the Ukraine war and the Covid pandemic – to delay the 2025 car CO2 targets.

The organisation is citing stagnant EV sales and an increasingly difficult market environment as key factors, highlighting the tensions between the EU's ambitions and the automotive industry's capacity to meet them.

ACEA expressed growing concerns about the automotive sector’s ability to comply with the EU's stringent CO2 emissions targets, warning that the slow uptake of electric vehicles is "sending an extremely worrying signal for industry and policy makers."

“The EU automotive industry has invested billions in electrification to put vehicles on the market, but the other necessary ingredients for this transition are not in place, and the competitiveness of the EU is eroding,” ACEA said in a statement on its website.

“The transition to zero-emission vehicles is highly challenging, and concerns about meeting the 2025 CO2 emission reduction targets for light-duty vehicles are on the rise.”

The ACEA points to several critical gaps in infrastructure and market readiness, noting the lack of sufficient charging stations, hydrogen refuelling infrastructure, and access to affordable green energy.

It also notes the supply chain challenges, including securing raw materials and batteries, as well as insufficient purchase and tax incentives to make EVs more accessible to consumers.

Italy's Prime Minister Mario Draghi also recently weighed in on the issue, highlighting the lack of cohesive EU planning. "The automotive sector is a key example of a climate policy without an industrial policy," Draghi said in a report on competitiveness prepared for the European Commission.

According to media reports, ACEA is expected to lobby the European Union for emergency regulatory intervention to delay the 2025 emissions targets.

A draft proposal seen by Bloomberg suggests that under current EU rules, carmakers could be forced to halt production of up to 2 million vehicles or incur fines that could reach €13 billion (£11 billion) for passenger cars and an additional €2.5 billion for vans.

“The EU is in a crisis caused by low consumer demand for EVs and unfair competition from third-country EV manufacturers,” an ACEA draft reportedly stated, adding that the stringent targets could harm the region’s economic security.

While ACEA affirmed its commitment to the Paris climate goals, it is officially calling for a more measured approach. “A substantive and holistic review of the CO2 regulation will be crucial to assess real-world progress against the ambition level, and to take action as appropriate,” the association noted on its website.

Julia Poliscanova, senior director for vehicles and emobility supply chains at environmental lobby group T&E, said: “This is cynical and absurd. Carmakers made over €130 billion in profits in the last two years and had years to prepare for the target. Now they want the EU to declare a state of emergency so they can continue selling dirty cars and making large profits. This is not a war or a pandemic, but a self serving stunt.”