ZURICH, November 05 (AJP) -European Union lawmakers have backed easing the bloc’s planned 2035 ban on new petrol and diesel cars, a shift that could give Hyundai Motor more room to maneuver while reducing some of the regulatory advantage Kia has built through stronger electric vehicle sales.
The European Parliament’s environment committee approved the proposal Wednesday by 48 votes to 30, with two abstentions. The full Parliament is expected to vote in December before negotiations with EU governments on a final text. The existing rules remain in force.
The vote comes as Europe’s car industry presses for greater flexibility in the transition to electric vehicles amid intense competition and uneven demand.
Under rules agreed in 2023, new cars and vans must achieve a 100 percent reduction in fleet-average exhaust carbon dioxide emissions by 2035 compared with 2021 levels, effectively ending sales of new conventional petrol and diesel cars, including hybrids that retain combustion engines.
The committee’s proposal would lower the required reduction in car exhaust emissions to 87.5 percent. Credits linked to low-carbon steel produced in the EU would contribute another 7.5 percentage points, bringing the combined reduction to 95 percent.
The proposed 2035 target for vans would fall to 80 percent, with steel credits also available.
The distinction matters when comparing the plan with the European Commission’s December 2025 proposal. The Commission sought a 90 percent reduction in exhaust emissions, with the remaining 10 percent compensated through low-carbon steel and alternative fuels. The committee’s version would require a smaller exhaust-emissions cut and leave part of the remaining emissions uncompensated.
“Our agreement marks a turning point for the European automotive industry,” said Massimiliano Salini, the proposal’s lead parliamentary negotiator from the center-right European People’s Party.
The changes would preserve room for combustion-engine and hybrid vehicles beyond 2035. They would also reward some electric vehicles manufactured in Europe, allowing qualifying small or highly efficient models to count more heavily toward compliance.
For Hyundai and Kia, the debate comes against sharply different emissions records in Europe.
Although both belong to Hyundai Motor Group, their emissions performance is currently assessed separately. Kia is on track to meet its targets, while Hyundai remains above its limit.
Kia’s average emissions from January 2025 through September 2026 were 5 grams of carbon dioxide per kilometer below its target, according to the International Council on Clean Transportation (ICCT). Battery electric vehicles accounted for 44 percent of Kia’s September registrations in the markets covered by the report, compared with an average of 31 percent.
Hyundai’s shortfall carries a potential financial cost. Daishin Securities estimated possible penalties of about 600 billion won using emissions performance from January 2025 through August 2026, according to MoneyToday.
The penalty formula is 95 euros for ach gram per kilometer above a manufacturer’s target, multiplied by its new vehicle registrations. Compliance for the current period will be assessed over the three years from 2025 to 2027, giving Hyundai time to improve its average by increasing electric vehicle sales. Volkswagen and Stellantis also remain above their targets.
Hyundai’s European sales fell 17.5 percent in September from a year earlier to 39,821 vehicles, while Kia’s rose 13.7 percent to 56,437, according to European Automobile Manufacturers’ Association data. Their combined sales declined 1.7 percent to 96,258 vehicles.
A weaker 2035 target could ease longer-term pressure on manufacturers whose electric vehicle sales lag and reduce the compliance advantage enjoyed by stronger performers such as Kia. But the proposed retreat from the 2035 phaseout does not itself resolve Hyundai’s current shortfall. Its immediate task remains meeting the emissions target for 2025–2027.
- Tags: European Union, European Parliament, European Commission, Hyundai Motor, Kia, Volkswagen, Stellantis, ICCT, ACEA, Daishin Securities, Massimiliano Salini, Michael Bloss, electric vehicles, carbon emissions, combustion engine ban
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