The European Union’s ambitious climate goals—to achieve carbon neutrality by 2050—rest heavily on the mass adoption of electric vehicles (EVs). However, widespread uptake is currently hampered by the barrier of high initial purchase costs for many consumers. In response, the EU has employed a two-pronged strategy: punitive emissions targets to force manufacturers to produce more EVs, and systemic regulations to drive down long-term production costs. This article details the critical EU legislative actions aimed at boosting affordability by 2025 and examines the policy challenges in meeting these goals.

The Legislative Context: CO2 Targets and the ICE Phase-Out

The overarching legislative framework is the commitment to phase out new sales of internal combustion engine (ICE) vehicles by 2035. This hard deadline creates existential pressure on automakers. More immediately, the EU imposes stringent CO2 emission reduction targets for automakers’ average fleet sales.

The next major reduction stage is 2025, which … Continue reading >>>