France and Germany Move to Soften Europe's 2035 Combustion Ban — With Conditions

A Franco-German push to reshape the EU’s 2035 zero-emission deadline is taking shape, but the deal is far from signed. Berlin and Paris have spent much of this year negotiating the bloc’s “Made in Europe” criteria for the auto sector, and a draft text was expected to be inked on October 15.

That didn’t happen. Germany’s Social Democratic Party, the centre-left junior partner in the governing coalition, balked at the omission of environmental targets it regards as non-negotiable. “A final agreement has yet to be reached,” a German government spokesperson confirmed.

The outline of the bargain is straightforward enough. Germany would swallow tougher local-content requirements for cars — a long-standing French priority — in return for loosening the ban on combustion engines. In the draft, the two governments argue that the current regulatory framework predates major technological, economic and geopolitical shifts, and that the forthcoming Automotive Package ought to weigh climate goals against industrial competitiveness, technology development and European value creation.

What the Numbers Actually Say

The EU’s existing rule calls for a 100 percent cut in exhaust CO₂ by 2035, with a provision letting manufacturers claim up to ten percent relief through offsets and investments. According to Politico, the Franco-German proposal would lower the headline target to 90 percent and hand out a further ten points of leeway in exchange for spending on alternative fuels.

German daily Der Spiegel reads the same text differently: the 90 percent stays as the Commission proposed, and the only change is that alternative fuels count toward the remaining ten percent — meaning carmakers wouldn’t have to offset that slice at all. Pick your interpretation. The final wording is still anyone’s guess.

And the details are where things get murky. What counts as an alternative fuel? Algae-based diesel, the kind Exxon spent more than a decade promoting? Hydrogen derived from methane? E-fuels brewed from surplus renewable electricity sound tidy, but with data centres hoovering up power, spare green electrons may be in short supply.

Porsche’s Stake in the E-Fuel Bet

Porsche has put over $100 million into e-fuel production in Chile across the past five years, largely so its customers can keep running cars like the 911 Club Sport if petrol dries up. Michael Steiner, who heads research and development at Porsche, has said the technology matters because more than 1.3 billion combustion-engined vehicles are on the roads worldwide and many will be for decades. “E-fuels offer the owners of existing cars a nearly carbon neutral alternative,” he has argued.

Both capitals also want public money tied more tightly to European manufacturing goals, though the draft — as reported by Der Spiegel — never spells out what that means in practice. One thing the document does not do is quantify. Vague language, no figures, plenty of room for dispute.

The Backlash Is Already Loud

Environmental groups wasted no time. Susanne Goetz of Transport and Environment called the Franco-German approach “a historic mistake” that would sharply slow EV sales. Bruxelles scepticism runs deep too. MEP Tiemo Wölken told Der Spiegel the draft “is not sufficient,” warning that trimming CO₂ ambition without compensation makes transport climate targets close to impossible.

The political backdrop doesn’t help. Far-right parties made strong gains in both countries, and their indifference to the climate emergency makes consensus harder to build. Yet the deadline keeps its grip on the industry. Volkswagen Group, facing soft demand, is weighing up to 100,000 job cuts over the coming years and possibly closing four German plants — and every auto job is reckoned to support as many as six others outside the factory gates. That arithmetic hangs over every paragraph of the negotiation.