Germany, Italy launch joint call to soften EU’s 2035 new combustion engine car ban | NEWS
The Breakdown
In a significant policy alignment, Germany and Italy have formalized a joint strategy to push back on the European Union’s impending ban of new combustion engine vehicles, set to begin in 2035. Their recent 24-point declaration urges the EU to permit continued sales of advanced hybrids and internal combustion engines powered by low- and zero-emissions fuels—if emissions are properly offset. This coalition is partly in response to growing concerns over the industrial competitiveness and employment within the automotive, chemical, and supporting sectors, all amidst tightening climate regulations. In parallel, the two countries are also advocating for revisions to the EU’s carbon border adjustment measures and increased support for the strategic chemical sector, signaling a strong coordinated approach to major regulatory shifts impacting specialty chemicals and polymers value chains.
Analyst View
The German-Italian initiative underscores real-time volatility embedded in Europe’s regulatory roadmap for mobility and energy-intensive sectors. For B2B leaders in specialty chemicals and polymers, the accelerated pace of regulatory evolution on combustion engines, emissions reporting, and product compliance represents both risk and opportunity.
First, the joint call for exemptions and adjustments to forthcoming bans and mechanisms reflects concern that abrupt disruption could destabilize demand patterns, particularly for sectors supplying automotive, component, and chemical industries. The persistence of uncertainty around technology standards and allowable fuels post-2035 suggests a need for agile resource allocation and lock-step innovation with upstream OEMs and manufacturing partners.
Second, the targeted support for the chemical sector—and demand for revisiting carbon cost passthroughs—signals a recognition of the sector’s foundational value in downstream manufacturing and supply continuity. Leaders must closely watch for further coalition-building among EU member states, as this could shift the balance of compliance expectations, incentives, and penalties—redirecting investment logic and altering growth outlooks literally across the value chain.
Finally, engagement with initiatives such as the Critical Chemicals Alliance and the call for measured implementation of carbon border adjustments indicate a heightened focus on operating resilience, from energy procurement to trade flows. Strategic planning now must account for both formal regulatory timelines and the increasingly political nature of their execution.
Navigating the Signals
Regulatory policy—no longer “set and forget”—has become a moving target. Business leaders must prepare for an environment where transitional arrangements, carve-outs, or entire policy reversals remain possible, especially when industrial competitiveness and employment are at stake for major EU economies.
This is a clarion call for organizations to evaluate the flexibility and responsiveness of their supply chains—not only to comply with or capitalize on changing legislation, but to anticipate policy timing and enforcement lags. Proactive scenario modeling, close customer dialogue, and ongoing voice-of-the-regulator intelligence are all now required disciplines.
Internally, executive teams should now be asking: Do our growth assumptions reflect a full range of plausible EU regulatory outcomes? How prepared are our commercial channels and partners to pivot between different compliance expectations? What investment in advocacy or industry coalition efforts is warranted given this fluid legislative climate?
What’s Next?
Breakthrough Marketing Technology partners with industry leaders to provide market foresight and actionable clarity in the face of regulatory ambiguity. We help you turn market signals into first-mover advantage by:
- Enabling scenario-based growth planning to address a shifting legislative framework
- Mapping value chain risk and opportunity as policy directions evolve
- Aligning go-to-market and channel strategies to emerging stakeholder requirements
- Facilitating executive-level alignment around proactive responses and investments in advocacy
Most importantly, we empower decision-makers to continuously assess both market readiness and potential headwinds, supporting confident action in a time of complexity and accelerated change.
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