It is worth noting that the parliamentary result does not mean that the relevant laws and regulations have been adopted, and the decision to ban the sale of fuel cars in 2035 still requires the unanimous approval and consent of EU member states for the legislation to take effect. On June 22, German Finance Minister Lindner said that the EU’s ban on the sale of fuel cars from 2035 is wrong, considering that carmakers in other regions will continue to sell fuel cars. There is still a market for fuel cars. After that, Italy, Portugal, and other countries successively called for a five-year delay in the implementation of this plan. In addition, the European Automobile Manufacturers Association, the European Federation of Automotive Suppliers, and other industry groups are also opposed to the goal of banning the sale of fuel cars from 2035 due to concerns about inadequate charging facilities and the fact that banning the sale of fuel cars would significantly reduce jobs for suppliers.

For the reason for Germany’s opposition, some experts pointed out that, as it is a big country in the automobile industry, there are more fuel cars and related factories, and the pressure to reduce carbon emissions has increased, and if we follow the EU’s timeline, it may lead to the closure of many factories, which will affect the GDP. Lack of funds to promote the progress of the electric car industry to develop

However, just one week later, on June 29, after 16 hours of negotiations, the 27 member states of the European Union reached an agreement to unanimously support the goal of zero-carbon emissions by 2035, when fuel cars will no longer be sold. The proposal was previously adopted in the European Parliament and now needs to be discussed between the EU Council and the European Parliament to determine the details, after which the legislation will officially come into effect.

Germany’s acceptance of the EU’s 2035 fuel car ban is conditional on allowing the sale of cars that run on CO2-neutral fuels. In response, the European Commission said it will retain the 2035 target while assessing in 2026 whether cars using synthetic fuels or hybrid vehicles can continue to be sold on the market; at the same time, it also approved a five-year extension of the exemption period for carbon emission obligations for niche automakers and automakers with fewer than 10,000 units in volume production, which will not have to meet the 55 percent reduction in carbon emissions by 2030. These manufacturers will not be required to meet the 55% reduction in carbon emissions by 2030 but will be required to switch to new energy sources by the end of 2035, as will other manufacturers.

Why is the EU eager to legislate for a fuel car ban?

On the one hand, from the point of view of energy issues, EU statistics data show that about 30% of the EU’s current oil imports are from Russia, the total amount of crude oil imports from Russia in 2021 amounted to 48 billion euros, and with the stalemate between Russia and Ukraine, the international crude oil prices are high, the EU countries are more urgent to break the situation of excessive energy dependence on imports.

On the other hand, it is part of the EU’s decarbonization plan, and at the same time hopes to maintain the same market share in the new energy vehicle landscape as in the traditional fuel car era. Based on the desire for transformation, the EU has proposed incentives such as preferential subsidies for the electric vehicle market, stimulating electric vehicle consumption, and promoting the development of electric vehicles through industrial subsidies, free charging, tax breaks, and various incentives including preferential subsidies for consumers in terms of the policy.

The problems caused by the ban on fuel cars cannot be ignored.

Achieving the goal of banning the sale of fuel cars will involve car companies needing to accelerate the transition to new energy vehicles. In this process, car companies need to invest a lot of money in research and development, resulting in increased costs and reduced profits. And, the transformation means the need for new factories or renovation of production lines, the relevant technical personnel may need to be re-trained, and the traditional internal combustion engine engineers may face unemployment, while the industry chain also needs to change. The European Federation of Automotive Suppliers has predicted that the EU automotive suppliers may be forced to cut 500,000 jobs by 2040.

The German Automotive Industry Association is worried about the speed of laying supporting facilities such as charging piles, which may not be able to keep up with the EU’s plans. The European Automobile Industry Association data show that there are currently about 374,000 public charging piles in the EU, and according to the EU transport sector emissions reduction targets, the EU needs 6.8 million public charging piles by 2030.

Therefore, from the perspective of infrastructure facilities, the EU may encounter the following problems. First, the construction of charging support infrastructure is seriously lagging. Second, the distribution of charging facilities institutions is uneven across countries, with some countries having more and some countries have very few. Third, with the growth of trams, the European grid will face a huge test.

Stellaris Group has warned that unless electric cars become cheaper, the auto industry will become turbulent. As raw material prices continue to rise, leading to rising costs, some new energy models have already increased prices. Not only that, in June the European Commission is evaluating the European Chemicals Agency’s proposal to include lithium carbonate, lithium chloride, and lithium hydroxide as substances harmful to human health, and once the law is formed, it means that the production costs of electric car suppliers will also rise.

Industry insiders believe that the fuel car in specific occasions, such as alpine and another special environment, the unique advantages of electric vehicles can not be replaced, still belong to the rigid demand products.

By Josie