In a decisive move to support Europe’s automotive sector amid mounting regulatory and technological pressures, the European Parliament has adopted a key reform to vehicle emissions rules.
The new measure introduces greater flexibility for car and van manufacturers by allowing them to average their CO2 emissions over a three-year period – 2025 to 2027 – instead of meeting annual targets.
This strategic adjustment aims to ease compliance burdens while maintaining the EU’s climate commitments as the industry undergoes a challenging transition toward zero-emission mobility.
A strategic shift to support industry transition
This amendment is a central element of the European Commission’s industrial action plan for the automotive sector, unveiled on 5 March 2025.
The initiative emerged from a high-level strategic dialogue launched by Commission President Ursula von der Leyen on 30 January 2025.
The dialogue brought together key stakeholders, from industry leaders to the public, in a collective effort to address the sector’s evolving challenges, including decarbonisation and digitalisation.
With 458 votes in favour, 101 against, and 14 abstentions, the Parliament overwhelmingly backed the new vehicle emissions approach.
The proposal reflects growing recognition of the operational pressures carmakers face, especially amid rapid technological innovation and intensifying global competition.
Flexibility to drive compliance
Under current EU rules, vehicle manufacturers must meet strict annual CO2 emissions targets over five-year periods.
Starting in 2025, automakers must reduce fleet-wide emissions by 15% compared to 2021 levels for the 2025–2029 compliance cycle.
The newly adopted measure, however, gives manufacturers the option to average their emissions performance across 2025, 2026, and 2027.
This change allows companies to offset a shortfall in one year by exceeding targets in another, offering much-needed adaptability during a time of evolving consumer demand and supply chain uncertainties.
Industry welcomes pragmatic vehicle emissions approach
The European Automobile Manufacturers’ Association (ACEA) praised the Parliament’s decision, highlighting the benefits of a more flexible emissions strategy.
ACEA said the three-year averaging framework offers manufacturers critical breathing room as they navigate fluctuating market demand and production timelines.
Sigrid de Vries, ACEA Director General, added: “The introduction of a three-year averaging mechanism is a step in the right direction that acknowledges the complexities and the ongoing difficulties of the automotive market, with slow market uptake and a lack of domestic value chain for batteries.
“While this provides some necessary flexibility for manufacturers in the short term, we need a long-term decarbonisation strategy including more charging stations, purchase and tax incentives, and fairer energy prices while keeping the industry a competitive powerhouse and securing the EU’s strategic autonomy on critical technologies.
“We look forward to discussing this during the next Strategic Dialogue with the European Commission.”
As Europe accelerates its push toward climate neutrality, the latest vehicle emissions adjustment demonstrates a pragmatic balancing act – safeguarding environmental goals while supporting the industry through a complex and fast-moving transition.
