The European Commission published its automotive package, outlining initial measures aimed at aligning the bloc’s decarbonization goals with competitiveness and industrial resilience, a move that could shape compliance pathways for vehicle manufacturers over the next decade. The package signals a shift toward greater flexibility and technology neutrality, as the European Union seeks to balance emissions targets with market realities, according to industry representatives.
The proposals arrive as Europe’s massive automotive industry faces slowing demand for electrified vehicles, uneven charging infrastructure coverage and rising global competition.
Automakers have raised concerns that existing carbon dioxide targets for 2030 and 2035 do not reflect current economic and supply-chain conditions, particularly for cars, vans and heavy-duty vehicles.
Broader industry analyses, such as data on shrinking lubricants demand amid rising electrification in Europe, show how slower internal combustion engine vehicle turnover is affecting finished lubricant markets regionally, with automotive engine oils declining as BEV and hybrid adoption rises.
At an initial review, the package appears to lack sufficiently decisive measures to support the transition in the coming years, particularly regarding compliance flexibilities for cars and vans ahead of the 2030 milestone, which is four years away. Industry officials have also flagged concerns that strict conditions tied to certain provisions could undermine technology openness and competitiveness, including proposed “made in the EU” requirements and an emissions compensation mechanism that may require further assessment.
The package includes measures addressing light commercial vehicles through compliance averaging and revised 2030 targets, as well as a targeted amendment for heavy commercial vehicles that would require swift adoption and an earlier review of CO2 rules than currently scheduled. The evolving regulatory landscape also intersects with emerging e-fluid products for electric and electrified drivetrains, which are attracting attention from OEMs and lubricant suppliers as hybrid and EV markets expand.
The proposals “rightly recognize the need for more flexibility and technology neutrality to make the green transition a success. This constitutes a major change compared to the current law,” said Sigrid de Vries, director general of the European Automobile Manufacturers’ Association (ACEA). “However, the devil can be very much in the detail. We will now study the package, and work with co-legislators to critically strengthen the proposals where needed.”
The Commission also proposed steps intended to improve the competitiveness of small-car manufacturing in Europe, though industry groups said those measures warrant closer scrutiny. Plans to mandate the greening of corporate fleets could conflict with market-based incentive approaches, while demand-side support remains necessary across vehicle segments, including heavy-duty trucks.
Many suppliers are already investing in advanced fluids and thermal management oils tailored for EV and hybrid platforms, efforts that reflect industry adaptation to shifting transport technology.
Automakers say the assumptions underpinning the EU’s 2030 and 2035 carbon dioxide targets have been overtaken by changes in economic and supply-chain conditions. Higher interest rates and inflation have weakened vehicle demand and slowed fleet renewal, while battery raw-material constraints and limited cell production capacity in Europe have pushed battery-electric vehicle costs well above those of internal combustion models.
Battery-electric cars still account for roughly 15% to 20% of new registrations in the EU, below levels implied by the 2030 compliance trajectory, while electric vans represent less than 10% of new sales. In the heavy-duty segment, zero-emission trucks account for only a low single-digit share of registrations, with costs typically two to three times higher than diesel equivalents and charging or hydrogen infrastructure unevenly available. Manufacturers say these gaps raise the risk that compliance penalties will increase faster than market and infrastructure readiness, particularly as the 2030 milestone approaches.