The dispute within the German government over the future approval of cars with combustion engines is now to be finally settled: Chancellor Friedrich Merz (CDU) announced an agreement for Thursday evening at the coalition committee meeting, which he will then communicate to the EU Commission. Meanwhile, according to a media report, CSU leader Markus Söder increased the pressure to push through a significant relaxation of the current EU regulations from 2035 onwards.
Under current regulations, new cars will no longer be allowed to emit CO2 from that point onward. In effect, cars with combustion engines could then no longer be registered. The EU Commission is currently reviewing a revision of the law and intends to present corresponding proposals in two weeks. The German government, however, has not yet reached a coordinated position on the matter.
The proposals differ in detail. The CSU party is particularly ardent, aiming to make it as easy as possible to continue selling combustion engine vehicles. For example, hybrid cars should be permitted, as well as combustion engine vehicles if they are fueled with synthetic or otherwise sustainably produced fuels. According to a report in the Handelsblatt newspaper, party leader Söder is also advocating for extending government subsidy programs for electric cars to hybrid vehicles.
Image: Silas Stein / AFP
Merz is calling for greater “technological openness” to protect the domestic automotive industry. One example under discussion is range extenders: an additional combustion engine installed in an electric car to charge the battery while driving. The environmental impact assessments of materials used in new cars could also be taken into account – for example, if green steel is used.
The SPD, particularly in the automotive state of Lower Saxony, also wants to relax the so-called combustion engine phase-out. In return, the Social Democrats are demanding guarantees for production locations and jobs from manufacturers. They are also open to mechanisms to give domestic manufacturers preferential treatment, such as those demanded by France.
The background to this is primarily the problems faced by German automakers and their suppliers. Converting production to electric drive is costly for them, the competition, especially from Asia, is at least technologically on par, and at the same time, sales figures for electric vehicles continue to be sluggish.
An analysis by the car insurer HUK-Coburg now shows a renewed willingness to switch from combustion engine vehicles to electric cars. The frequency of these switches has “more than doubled” since the low point at the beginning of 2024, when the government’s electric vehicle purchase incentive was discontinued, HUK-Coburg announced. According to the analysis, 6.2 percent of all privately owned vehicles made such a switch in the third quarter of 2025.
Nevertheless, the vast majority of new cars sold still have combustion engines. “The ramp-up of electromobility will be a long process; we will see combustion engines and electric cars coexisting for many years to come,” explained automotive expert Constantin Gall of the consulting firm EY.
The automotive industry is also placing great hope in alternative fuels. Munich-based automaker BMW, for example, has developed a system that can track which fuel a car has been running on. This would be important if new combustion engine vehicles are still permitted to be registered after 2035, provided they are exclusively fueled with alternative fuels.
However, the environmental organization Transport & Environment (T&E) warned of a technological dead end: Biofuels, such as those made from animal fats or used cooking oil, are likely to remain scarce, just like synthetic e-fuels. If combustion engine cars were now being fueled with biofuels en masse, it would become more difficult to “make sectors that are hard to decarbonize, such as aviation, more climate-friendly,” the environmentalists explained.
Sebastian Bock, Managing Director of T&E Germany, criticized the presentation of biofuels as a “scalable solution” as misleading. “Europeans can’t eat enough fries to sustainably power even a fraction of the cars in Europe with leftover cooking oil, let alone ships and airplanes,” he stated. Electric cars already represent a mature technology. A “delaying tactic for the combustion engine” threatens to set German manufacturers back in the global electric car market.
AFP – Translated by Blackout News