France and Germany Agree to Ease Emission Rules and Rescue Europe's Auto Industry

Paris and Berlin have a deal. France and Germany announced Friday a joint agreement on the future of the European automotive industry, easing CO2 emission cuts before 2035 in exchange for strengthening the "Made in Europe" principle. The agreement aims to secure the sector's future while maintaining climate targets and production within the continent.

Macron: We Want a Successful Transition While Keeping Production in Europe

"We are driven by a clear ambition." That was French President Emmanuel Macron's take on the deal, adding that the goal is to make the automotive transition a success while preserving climate objectives and European production. German Chancellor Friedrich Merz called it "a good day for drivers and for employment in Germany, France, and Europe," signaling the balance the agreement tries to strike between environmental protection and the interests of workers and manufacturers.

Emission Targets Eased: 90% Cut Instead of 100% by 2035

The French-German document, seen by AFP, reveals the details. Manufacturers will be required to cut their CO2 emissions by 90 percent by 2035, down from the 100 percent proposed by the EU. The remaining 10 percent won't need to be offset, justified by "the growing use of renewable fuels" such as biofuels. This retreat from a full transition to electric vehicles has angered environmental groups, who see it as a step back from the EU's climate commitments.

Germany Accepts Stricter Definition of 'Made in Europe'

Berlin, for its part, accepted a stricter definition of European preference. Companies benefiting from public funds will be required to source components manufactured in Europe or partner countries like the UK, Norway, and Switzerland. The protectionist logic of "Made in Europe" primarily aims to counter the influx of Chinese cars into the European market. That have gained strong traction in recent years thanks to competitive pricing and the expansion of brands like BYD and MG across Europe.

Historic Mistake or Necessary Compromise?

The clean transport group T&E called the agreement a "historic mistake." Environmental organizations argue that easing targets slows the shift to electric vehicles and gives the combustion engine industry extra breathing room. But Paris and Berlin see the deal as protecting jobs at factories run by Renault, Volkswagen, and other European manufacturers facing fierce competition from China and the US.

Cars with combustion engines will benefit from greater flexibility. France made concessions on this specific file, while Germany secured a stricter definition of European components. The balance between climate and industry remains fragile, but the agreement gives the European auto industry some room to breathe amid the accelerating global electric shift.