Nine EU countries rebel against EU's green targets for corporate cars and vans

Nine European capital cities have joined forces to oppose a European Commission proposal that would require large corporate vehicle fleets to switch to electric vehicles, according to a document seen by Euronews.

A coalition led by Poland and including Bulgaria, the Czech Republic, Estonia, Hungary, Italy, Latvia, Slovakia and Romania has launched a coordinated challenge to the Commission's proposed law, which would compel companies with more than 250 employees or more than €50 million turnover to decarbonise their fleets of cars and vans.

The topic is set to be discussed at a gathering of EU transport ministers in Luxembourg on Monday.

The Commission is proposing that by 2030, large companies' fleets will be subject to two separate mandatory quotas: that roughly 69 percent of all new purchased vehicles be plug-in hybrids and that around 45 percent battery-electric or hydrogen-powered cars. The precise targets would vary by member state.

The nine EU governments acknowledge that corporate fleets can play a major role in accelerating the shift to cleaner vehicles and reducing Europe's dependence on imported oil, which accounts for almost 60 percent of the bloc's imports, but they also argue that mandatory quotas risk undermining competitiveness and placing additional burdens on businesses.

On that basis, they call for the bloc to use incentives instead of regulation.

"Priority should be given to an enabling EU framework based on guidelines, exchange of best practices, targeted incentives, and technical support, rather than the proposed regulation," they write.

A recent analysis by the campaign group Transport & Environment (T&E) claims that in 18 of 27 EU countries, the tax gap between electric and fossil-fuel cars is insufficient to offset higher EV prices.

Stef Cornelis, fleets and freight director at T&E, said the EU's largest car markets – Germany, Spain, Italy and Poland – are failing to incentivise companies to go electric.

“The EU fleets regulation is the catalyst needed to break this inertia. The EU Council and EU Parliament should inject more ambition into the Commission’s proposal to ensure Europe can reduce oil imports rapidly,” said Cornelis.

T&E noted that cars and vans linked to corporate businesses account for 59 percent of new car registrations and 78 percent of oil imports consumed.

Another major concern among the nine governments is the uneven readiness among EU countries. They point to significant differences across Europe in charging infrastructure, leasing markets, taxation systems, grid capacity and administrative frameworks, arguing that a one-size-fits-all target risks penalising countries where the supporting ecosystem for electrification remains underdeveloped.

"The preparation of Commission guidelines, combined with a structured exchange of best practices, could enable member states to tailor implementation to their specific circumstances," the document reads.

Avoiding collateral damage

Although the Commission's proposal formally targets large companies, the nine governments argue that the burden could cascade through leasing and rental markets because many small businesses rely on leasing rather than direct vehicle purchases. Fleet obligations imposed on leasing companies, they say, could effectively be imposed on SMEs.

"Covering leasing companies with targets, without exceptions for certain groups of their clients, would lead in practice to exposing SMEs to these targets," reads the document, noting that around 80 percent of cars acquired by SMEs are not purchased vehicles.

The dissenting capitals also insist that special-purpose vehicles and fleets linked to critical infrastructure, emergency response and public preparedness require greater flexibility than the Commission proposal currently appears to provide.

Operational readiness, they argue, must not become collateral damage in the pursuit of climate targets.

"The greening of corporate fleets should also be pursued in a manner consistent with the Union’s broader objectives of resilience, emergency preparedness and economic security, particularly in light of the current geopolitical situation," reads the document.