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EU Faces Back-lash from Auto Industry Over Proposed Mandatory EV Fleet Targets

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  //automotive-transportation.news-articles.net/co .. ry-over-proposed-mandatory-ev-fleet-targets.html
  Published in Automotive and Transportation on Monday, December 8th 2025 at 17:59 GMT by reuters.com

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EU Faces Back‑lash from Auto Industry Over Proposed Mandatory EV Fleet Targets

On 8 December 2025, a coalition of European carmakers, vehicle‑rental and leasing firms released a joint letter to the European Commission urging the bloc to scrap or at least postpone a mandatory electric‑vehicle (EV) fleet quota that would be imposed on new car sales by 2030. The appeal, drafted by the European Automobile Manufacturers Association (ACEA) and the European Association of Leasing Companies (EALC), highlights a growing unease among industry players about the pace, cost and feasibility of the EU’s aggressive electrification roadmap.

What the Letter Says

The industry consortium argues that the proposed mandatory quota—currently estimated to require 30 % of all new car sales to be battery‑electric or plug‑in hybrids by 2025 and 70 % by 2035—would put undue pressure on manufacturers, suppliers and consumers. The authors point to several key concerns:

• Supply‑chain bottlenecks: The rapid shift to EVs would require a massive expansion of battery production, with critical raw materials such as lithium, cobalt and nickel. According to the letter, current supply agreements and geopolitical risks (particularly the concentration of these metals in a few regions) could lead to production bottlenecks or price spikes that would hurt both industry and consumers.

• Infrastructure lag: While the EU has launched the “Charging Infrastructure Initiative” to expand public charging points, the letter stresses that the rollout is still uneven across member states. A sudden surge in EV demand could overwhelm existing networks, leading to range anxiety and consumer disincentives.

• Cost implications: The cost of battery‑equipped vehicles remains higher than that of internal‑combustion‑engine (ICE) cars. The consortium warns that mandatory quotas could force manufacturers to raise prices, potentially alienating price‑sensitive segments and driving consumers toward used‑car markets or older ICE models.

• Innovation trade‑offs: With a hard quota in place, the letter argues that manufacturers may focus on meeting the minimum requirement rather than investing in alternative electrification pathways—such as hydrogen fuel cells, advanced biofuels or hybrid solutions—which could diversify the industry’s future product portfolio.

The letter also points out that a “one‑size‑fits‑all” regulatory approach risks stifling the competitiveness of European brands, many of which rely on economies of scale and differentiated models tailored to specific markets.

The Industry Coalition

Key signatories include industry giants such as BMW, Daimler (Mercedes‑Benz), Volkswagen Group, Audi, Porsche, Renault‑Nissan‑Mitsubishi Alliance, PSA Group (Peugeot‑Citroën), and Stellantis. Rental and leasing giants like Europcar, Hertz, Avis Budget Group, Enterprise Holdings, and the European Leasing Association have also joined the appeal.

“We are fully committed to decarbonising mobility,” the letter reads. “But we believe that a flexible, phased approach—supported by incentives and infrastructure investment—will be more effective than a blanket mandatory target that may create unintended consequences.”

EU’s Climate Ambitions

The European Commission’s “Fit for 55” package, adopted in 2021, set the EU’s net‑zero by 2050 goal and outlined measures to cut greenhouse‑gas (GHG) emissions by 55 % by 2030 compared with 1990 levels. Central to this package is the “EU Green Deal”, which, among other initiatives, aims to double the share of new electric cars sold in the EU to 30 % by 2030. To enforce these goals, the Commission has proposed a “Fleet Regulation” that would require automotive manufacturers to hit progressive EV targets.

The proposed regulation is expected to come into force in 2025, with a 10‑year transition period. By 2030, the Commission estimates that 30 % of all new vehicles sold in the EU would need to be EVs, rising to 70 % by 2035. Critics argue that such targets would require a rapid expansion of the EV supply chain and may not leave sufficient room for market-driven adjustments.

What the EU Might Do

In a recent statement, the European Commission’s Commissioner for Climate Action, Virginijus Sinkevičius, acknowledged the industry’s concerns but maintained that the regulatory framework is essential to “force the industry to act” and “ensure that the EU does not fall behind its competitors”. He highlighted that the Commission’s proposals are still subject to negotiation and that the EU will consult with stakeholders throughout the process.

Other policymakers suggest that a middle‑ground could involve a combination of mandatory targets and strong incentives—such as tax breaks, subsidies for battery production and charging infrastructure, and extended warranties—to smooth the transition. The Commission’s “Investment Plan for the Decarbonisation of Industry” and “European Battery Alliance” are part of this broader strategy.

Broader Context

The industry’s concerns are not isolated. A February 2025 Reuters piece on the EU’s battery‑production capacity highlighted that Europe’s share of global lithium‑ion battery output is expected to rise from 30 % to 45 % by 2035, but only if public investment and supply‑chain cooperation accelerate. Meanwhile, a March 2025 report by the European Council on “Charging Infrastructure” pointed out that some EU members still lag behind in public charging density, especially in rural areas.

Additionally, a related Reuters article from January 2025 examined how automakers are diversifying their electrification strategies, with some exploring hydrogen fuel‑cell buses and trucks, and others focusing on ultra‑efficient hybrid systems for emerging markets.

Bottom Line

The letter from carmakers, rental, and leasing firms serves as a cautionary reminder that policy instruments designed to accelerate decarbonisation must balance ambition with practical feasibility. While the EU’s climate goals are widely supported, industry voices argue that a flexible, incentive‑driven path may ultimately yield more sustainable outcomes—both environmentally and economically—than a rigid, mandatory quota.

The debate is set to intensify in the coming months as the Commission finalises the Fleet Regulation and as the EU negotiates the exact quotas, timelines and enforcement mechanisms. Stakeholders on all sides will need to collaborate closely to ensure that the EU’s transition to a low‑carbon automotive sector is both swift and sound, safeguarding consumer choice, industry competitiveness and the continent’s climate ambitions alike.