The European Commission is expected to present its new “Automobile Package” next week, with early indications suggesting the proposal could allow new registrations of plug-in hybrids (PHEVs) and range-extender vehicles (EREVs) for an additional five years beyond the current 2035 deadline.
According to a Bloomberg report, the extension would apply only to models incorporating an internal combustion engine as part of an electrified drivetrain and would not reinstate approvals for conventional ICE vehicles or mild and full hybrids.
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Under the draft considerations, any extension would be subject to several conditions. Vehicles would need to operate exclusively on so-called “advanced biofuels” or e-fuels from 2035 onward, though it remains unclear how regulators would verify that fossil petrol is not being used.
Requirements for the use of green steel in vehicle production are also reportedly under discussion, but questions remain around the future availability and cost of the material. Bloomberg notes that “key technical details” relating to fuel definitions and volumes are still unresolved and that the overall quota of PHEVs and EREVs permitted after 2035 has not yet been determined.
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EU Transport Commissioner Apostolos Tzitzikostas has signalled that the Commission is examining limited pathways for continued use of combustion engines in highly electrified applications, but the scope remains narrow.
The Automobile Package is unlikely to include a full reversal of the 2035 phase-out, despite calls from politicians including German Chancellor Friedrich Merz, who urged the Commission to permit unrestricted sales of “highly efficient combustion engines” beyond the deadline. The emerging framework instead points toward a compromise involving conditional allowances paired with stricter fuel and production criteria.
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Several member states—including Germany, Italy and Poland—have urged the Commission to soften the 2035 CO₂ targets, arguing that the scale and speed of the transition may strain the automotive industry. Opponents contend that diverting investment toward parallel technologies risks slowing the region’s progress in battery-electric vehicles and widening competitive gaps with China.
Environmental groups caution that loosely defined rules on e-fuels or biofuels could weaken Europe’s climate strategy. E-fuels can be carbon-neutral if produced with renewable energy and atmospheric CO₂ capture, but industrial-scale facilities do not yet exist and the associated energy requirements remain substantial. Biofuels continue to face scrutiny over land-use impacts and potential competition with food production. The Commission is expected to outline the final proposal as early as 16 or 17 December.
