European carmakers sold 38 percent more electric cars in the first seven months of the year, ensuring that all but Mercedes-Benz are on track to comply with the EU’s 2025-27 emission targets, new T&E research finds.
However, the two-year extension of the targets allowed carmakers to take the foot off the gas and will lead to two million fewer electric cars being sold between 2025 and 2027 than under the original deadline.
T&E called on the EU Commission to stand firm over the 2030 and 2035 targets when it hosts a strategic dialogue on the future of the automotive industry this Friday.
BMW, Renault and Volkswagen are expected to meet their 2025-27 emissions targets, according to T&E’s EV Progress Report. BMW
would be 13g per kilometre (gCO2/km) over-compliant with the maximum average emissions allowed under EU law between 2025 and 2027.
Stellantis and Renault would be 9 and 2 gCO2/km overcompliant, respectively, while Volkswagen will narrowly comply with no margin (0 gCO2/km) to spare.
Mercedes-Benz, which holds the presidency of the EU auto lobby ACEA and is the loudest opponent of the EU targets, is the only European car manufacturer that would fail to reach them on its own.
It would be 1gCO2/km under-compliant and would need to pay Volvo Cars and Polestar to purchase credits from them in a so-called pooling deal.
The EU is under pressure from carmakers to weaken their 2030 and 2035 emissions targets and earlier this year it
gave a major concession to the industry by extending the 2025 target deadline by two years.
Carmakers responded by increasing the price premium of electric models over combustion cars to 40 percent in June, up from 30 percent in early 2025.
As a result of the target extension, two million fewer electric cars are expected to be sold in the EU between 2025 and 2027.
This is despite positive market dynamics, which are pushing electric sales. Battery costs are set to fall by 27 percent between 2022 and the end of this year, and are set to decrease by another 28 percent by 2027 compared to 2025 levels, T&E forecasts.
Charging infrastructure has been deployed on 77 percent of the EU core
highway network, and all Member States have already met or surpassed the number of public charging points required by the EU’s 2025 target.
“OEMs are painting a terrible picture because they want their targets weakened. But the reality is that electric car sales are surging and emissions rules are key to that equation,” Lucien Mathieu, T&E Cars Director, said.
“By sticking to the agreed rules, Europe can give its automotive industry a fighting chance in the global EV race.
“But weakening the targets could see other manufacturers go the way of Mercedes which is falling behind on electrification and must buy credits from its competitors,”
While the EU is discussing further relaxing of its emission rules, global markers are going electric fast.
India, Mexico, Indonesia and Thailand have EV market shares of five percent, five percent, 13 percent and 24 percent, respectively.
In the world’s largest car market, China, BEV sales share will surpass 30 percent by the end of 2025. These markets will expand rapidly in the next decade, and unless Europe’s carmakers rapidly catch up now, Chinese manufacturers will dominate.
“European carmakers are living in cloud cuckoo land if they think China will stop innovating while they try to prolong the technology of the past,” Lucien Mathieu added.
“If the European Commission allows car manufacturers to stall on EV progress, Europe will lose ground on another key industry to global competitors.
“We need a European automotive industry that leads on one of the critical technologies of the 21st century, not one that puts us on the path to becoming a car museum.”