Economists Urge No Combustion Engine Reversal

Economists Urge No Combustion Engine Reversal

The German government is facing a stark warning from the nation’s Council of Economic Experts regarding potential backsliding on the planned phasing out of internal combustion engine (ICE) vehicles. Monika Schnitzer, head of the council, cautioned that repeated debates surrounding the 2035 deadline are actively undermining the transition to electric mobility and creating uncertainty for consumers.

Speaking to the “Rheinische Post” Schnitzer emphasized that the constant political wavering risks jeopardizing the progress demonstrated at the recent IAA Mobility fair, where German automakers unveiled a range of internationally competitive electric vehicle models. While the technological capability to produce these vehicles exists, consumer demand remains hesitant, largely due to the unpredictable policy landscape.

Schnitzer welcomed the government’s proposal to extend the tax exemption for electric vehicles until 2035, aligning it with the planned end of ICE vehicle sales. She argued that this measure incentivizes early adoption but stressed that lowering the operational costs of electric vehicles – specifically accelerating the development of affordable, user-friendly charging infrastructure – is paramount. Schnitzer highlighted the need for increased competition among charging station operators, transparent pricing structures and standardized practices that eliminate the current reliance on proprietary apps. The goal, she stated, should be to make electric vehicle charging as simple and accessible as filling a traditional gasoline tank.

The current climate targets, enshrined within the EU’s “Fit-for-55” package, necessitate increasingly stringent CO2 emission standards for new vehicles, ultimately culminating in a phase-out of ICE vehicle sales by 2035. These regulations are integral to the EU’s ambition to limit global warming to just above 2 degrees Celsius, a goal recently underscored by the International Court of Justice, which signaled the potential for legal action against states failing to adhere to the stricter 1.5-degree threshold.

Schnitzer’s warning underscores a critical juncture for German and European climate policy. While the technical capacity for electric vehicle adoption is developing, the political stability required to foster consumer confidence and drive market transformation remains fragile. The continued questioning of the 2035 deadline risks not only delaying the transition to a cleaner transportation sector but also undermining the credibility of Europe’s commitment to tackling climate change and potentially exposing nations to significant legal repercussions.