Economy Update – Follow-up
In a significant move today, the European Commission has responded to pressures from automotive manufacturers by extending the timeline for compliance with carbon dioxide emissions reduction targets. The new deadline has been set at three years instead of the previously anticipated one-year period for cars and small trucks.
Ursula von der Leyen, President of the European Commission, announced at a press conference that a formal proposal will be forthcoming, allowing for this three-year adjustment in compliance timelines.
Achievement of the emissions goals, and thus avoiding potential fines, will heavily rely on the increased sales of electric vehicles. In this arena, European automakers trail behind their competitors from China and the United States.
Von der Leyen emphasized, “The targets remain unchanged. Industry stakeholders must fulfill these objectives, but this extension provides additional time for compliance.” She noted that this proposal will require the endorsement of both the European Union and the European Parliament governments.
Following von der Leyen’s remarks, shares of major automotive companies such as Volkswagen, BMW, and Mercedes Benz experienced an uptick.
Industry insiders indicated that the commitments will be assessed based on the average emissions data collected over the period from 2025 to 2027.
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