The global automotive industry is entering a tough recalibration phase, amid slowing demand for electric vehicles, financial pressures, and shifts in public policy.
The European Union is preparing a significant relaxation of the ban on combustion engines from 2035, as reported by Politico, while major manufacturers are scaling back their electric ambitions and closing production capacities once considered symbols of the green transition.
The European Commission is on the verge of substantially weakening the objective that foresaw the complete elimination of CO₂-emitting car sales after 2035. According to a still-negotiating agreement, automakers would be required to reduce emissions by 90%, not 100%, allowing them to continue selling plug-in hybrid vehicles and models with extended range. The emissions difference would be offset by the use of green steel and alternative fuels, with the exact mechanisms still being discussed.
The decision is seen as a major victory for the automotive industry and center-right parties after months of intense lobbying, but it is strongly criticized by environmental organizations. "The EU is playing for time, while the next game has already begun. Every euro directed towards plug-in hybrids is a euro that no longer goes into electric vehicles, while China is advancing," said William Todts, director of the NGO Transport & Environment.
Tough Adjustments
Meanwhile, American and European automakers are adjusting their strategies. Ford has announced special costs of around $19.5 billion, mainly generated by the depreciation of assets in the fully electric vehicle area and the redirection of investments towards hybrid and extended-range electric models. The company has even decided to transform the electric F-150 Lightning pickup into an EREV (extended-range electric vehicle) model and cancel the development of a new generation of fully electric large trucks. CEO Jim Farley described the change as "a customer-driven decision aimed at creating a stronger, more resilient, and more profitable Ford."
In Europe, Volkswagen has announced the closure of the Dresden factory, marking the first permanent shutdown of a production unit in Germany in the group's 88-year history. The decision comes amid declining sales in China, weak demand in Europe, and the impact of American tariffs on exports. The Volkswagen factory, which has produced less than 200,000 vehicles since 2002 and has become a symbol of electrification in recent years through the production of the ID.3 model, will be transformed into a research campus in artificial intelligence and robotics, in partnership with the Dresden University of Technology.