Germany, Italy Signal They Could Block EU Combustion-Engine Ban

A group of large European Union countries is threatening to block a plan by Brussels to effectively ban the internal combustion engine, endangering the bloc’s ambitious agenda to combat climate change.

Germany and Italy said this week they could block the plan’s formal approval at crucial meetings this week and next. Berlin said it would oppose the plan unless Brussels agrees to allow so-called synthetic fuels that can burn like gasoline and diesel but spew fewer climate-damaging emissions alongside fully electric vehicles.

Under the leadership of the European Commission, the EU’s executive body, Europe has adopted an ambitious plan to fight climate-change-causing greenhouse-gas emissions. The plan relies heavily on the mass adoption of electric vehicles and effectively bans new combustion-engine vehicles from 2035.

Parts of the auto industry, which employs 3.4 million people in the EU—nearly 12% of all manufacturing jobs—have pushed back, arguing that including so-called e-fuels into the plan would allow emission targets to be hit while stretching the costly move away from combustion engines over decades.

Some governments have expressed sympathy with the demand as the move to electric vehicles, which are less complex to produce than their combustion rivals, threatens large numbers of jobs in the region.

Under a compromise reached last October, lawmakers agreed that the European Commission could put forward additional rules allowing new vehicles with engines that use carbon-neutral fuels to continue to be sold, but it has yet to do so.

German Transport Minister Volker Wissing on Tuesday said Berlin now wanted Brussels to present this legislation ahead of the plan’s approval, saying that because it had yet to do so, “the German government cannot approve the compromise.”

Italy’s Environment Ministry said that environmental targets should be pursued in a way that avoids harming jobs and production and that electric vehicles shouldn’t be seen as the only route to zero emissions.

Two other countries have also pushed back on the legislation. Poland has informed other member states it plans to vote against the plan, and Bulgaria has indicated it plans to abstain, four EU diplomats said. Poland’s government has previously said that such a ban would restrict consumer choice and lead to higher costs. By acting together, those countries have enough votes to block the plan’s approval.

A spokesman for the commission said it is up to the commission’s political leadership to determine what legislation to propose and when to do so. “The transition to zero-emissions vehicles is absolutely necessary” to meet the bloc’s climate targets, he said.

The European car sector and countries that have begun investing heavily in e-fuel development have spearheaded the effort against the provision in the commission’s plan stating that vehicles should be emissions-free by 2035—a de facto combustion-engine ban.

Germany, home to the region’s largest car makers, said this week that it would soon approve the use of synthetic fuels in the country, a move that would force Brussels to either follow suit or challenge the German law.

German auto makers, including Volkswagen AG, Mercedes-Benz Group AG, Porsche AG and Bayerische Motoren Werke AG, have pushed for the use of synthetic fuels to be allowed.

“I’m in favor of intelligent solutions rather than blanket bans,” VW CEO Oliver Blume was quoted as saying in the weekly Welt am Sonntag newspaper in January, adding: “E-fuels are a sensible addition to electric mobility.”

The shift to electric cars is beginning to affect auto-industry employment, raising concerns among politicians that the transition could be moving too fast.

Stellantis NV, which includes Italian auto maker Fiat, this week announced it would cut 2,000 jobs in Italy. Ford Motor Co. recently said it would shed about 3,800 jobs in Germany and the U.K., or around 11% of its European workforce, because fewer employees were needed as the company shifted to electric vehicles.

Meanwhile, Carlos Tavares, chief executive of Stellantis NV, whose brands include Fiat, Peugeot, Jeep and Chrysler, warned on an earnings call with reporters last month that the industry may be getting ahead of its customers.

“I don’t know if people will adapt to a new lifestyle as fast as the car companies have adapted to a new technology,” he said.