A Ban at the Crossroads
The European Union has set itself a bold target: by 2035, the sale of new cars with combustion engines should be a thing of the past, all in support of its ‘net zero’ climate ambitions. But with a review of this plan scheduled for the second half of 2025, critics are arguing that this rethink can’t come soon enough. After all, Europe’s auto sector is already navigating choppy waters: sluggish demand, brutal competition from Chinese brands, and disappointing sales figures for electric vehicles (EVs) are piling on the pressure—just what every struggling industry dreams of!
A Reality Check from Industry Insiders
In the German newspaper Handelsblatt, Ola Källenius—whose words pulled no punches—called for a serious « reality check ». His warning: the ban could do significant damage to the European economy. As he put it:
« Of course we have to decarbonize, but it must be done in a technology-neutral way. We must not lose sight of our economy. »
It’s a stark message: yes, fighting emissions is essential, but not at any cost to Europe’s economic wellbeing.
Eastern Headwinds: The Rise of Chinese Car Brands
For established European carmakers, the meteoric rise of Chinese brands is causing plenty of sleepless nights. Companies like BYD and Nio are flooding the market with technologically advanced, affordable EVs. The result? Massive pressure on prices and profit margins for their European rivals, who also need to invest heavily to electrify their lineups—talk about being stuck between a rock and a hard place.
Behind these Chinese brands stands a formidable supply chain and substantial government support, giving them an undeniable edge. If the EU pushes its manufacturers to go all-in on EVs before the market is truly ready, it risks further weakening Europe’s hand in this David-and-Goliath battle. The consequences? A real risk that European brands could lose out—shedding jobs, technological know-how, and precious market share.
More Than One Road to Clean Mobility
But Källenius isn’t advocating for blind loyalty to combustion engines. Instead, he calls for a technology-neutral approach. That means giving other sustainable solutions—like synthetic fuels (e-fuels)—a fair shot. These can neutralize emissions from today’s combustion cars and might offer a smoother on-ramp to a zero-emissions future.
By betting everything on one technological horse (fully electric vehicles) and excluding other promising options, the EU risks not only stifling innovation but accelerating the decline of one of its most vital economic sectors. What Källenius and others are really arguing for is more flexibility and less dogmatic policy—so that European industry can compete globally and still chase those crucial climate goals.
With the upcoming review of the EU ban just around the corner, the stakes could hardly be higher. It’s the moment when the future of the European automotive industry—and maybe even your next set of wheels—will hang in the balance.
John is a curious mind who loves to write about diverse topics. Passionate about sharing his thoughts and perspectives, he enjoys sparking conversations and encouraging discovery. For him, every subject is an invitation to discuss and learn.
