After months of trading barbs over where the European motor industry should be heading, France and Germany have finally found a formula both can live with. Each side gave up something it had fought hard for, and each can claim a win at home.
Berlin gets the bigger headline. Under the joint position published on Friday, manufacturers would no longer have to reach zero tailpipe emissions for new cars in 2035. A 90 percent cut compared with 2021 levels would be enough, and unlike the plan the European Commission had floated, carmakers would not need to make up the missing tenth through credits such as green steel. In practice, that means the original plan to stop selling new combustion-engine cars is dead. Paris and Berlin justify the step by pointing to wider use of biofuels and other low-carbon fuels.
France, in turn, wins on industrial policy. Germany has dropped its resistance to tougher local-content rules in the planned Industrial Accelerator Act. Companies that want public money or state contracts would have to rely on components built in Europe, with batteries a central concern. Under certain conditions, factories in trusted non-EU neighbours, among them the UK, Switzerland and Norway, would also qualify, something the British government had lobbied hard for.
The announcement was meant to come on Thursday, while EU leaders were meeting in Brussels. It slipped by a day because the Social Democrats, junior partner in the Berlin government of Friedrich Merz, were still not on board. Environment Minister Carsten Schneider, an SPD man, now speaks of a realignment that puts “jobs and production sites” first.
Merz called it a “good day for car drivers”. Emmanuel Macron said he hoped the Franco-German momentum would quickly win over other capitals. That is the catch: the other 25 governments and the MEPs in Strasbourg still have to sign off, and environmental groups are already furious that Europe is quietly abandoning its all-electric target.
