Deutsch-Französische Einigung zu „Made in Europe“ und Autoabgasen verzögert sich – SPD erhebt Einwände

Brussels — France and Germany failed to reach agreement on Thursday regarding the scope of the future "Made in Europe" regulations, the reduction of CO2 emissions, and the ban on combustion engines from 2035. The draft of the reciprocity agreement, about which POLITICO first reported in July, marks a significant convergence between the two countries, yet it was delayed after the SPD, the coalition partner of the German government, raised objections.

Concerns arose that key environmental goals might have been removed. A spokesperson for the German government confirmed that a final agreement was still pending. Earlier this week, French President Emmanuel Macron hinted that Germany would be next. "On the other side of the Rhine, there are political constraints, and I respect the coalition talks fully," Macron said on Monday at the Paris auto show.

Under the proposed agreement, Germany would accept stricter "Made in Europe" criteria for the automotive sector in the "Industrial Accelerator Act" in exchange for a relaxation of the combustion engine ban, one of Berlin's long-term demands. Both countries wrote in a draft agreement seen by POLITICO that the automotive package should strike a better balance between climate goals, industrial competitiveness, technological development, and strengthening European added value.

"Based on the German-French Councils of Ministers in 2025 and 2026, Germany and France are proposing a balanced negotiation package that combines ambitious CO2 reduction targets with additional flexibility and targeted incentives for European added value," the agreement states. Currently, the EU aims for companies to cut emissions from combustion engines by 100 percent by 2035 compared to the 2021 level, with a 10 percent room for maneuver in emissions through offset measures and investments.

Under the proposed agreement, France and Germany want to lower the 2035 target to 90 percent and, in return, grant an additional 10 percent room for maneuver (totaling 80 percent) for investments in alternative fuels. Crucial for German steel manufacturers and the left-leaning SPD, the German-French agreement would remove the investment obligation for "green steel," thus eliminating a significant incentive.

A lobbyist for the industry told POLITICO that "the leading market for green steel would be destroyed." The agreement emphasizes that the so-called "Utility Factor" for calculating emissions from plug-in hybrid vehicles should be based on laboratory results rather than real-world driving data, as demanded by the Commission. This change will help automakers sell more plug-in hybrids while meeting overall emission targets.

In exchange for these emission concessions, Germany agreed to France's request to limit the scope of "Made in Europe" regulations under the EU's "Industrial Accelerator Act" for the automotive sector. The regulation applies only to the 27 EU member states and extends to the UK under certain conditions. EU Industry Commissioner Stéphane Séjourné told POLITICO that he supports the agreement as a way out of the impasse and added that the UK currently meets the conditions for the "Made in Europe" label.

The EU's Industry Commissioner stated that the agreement could end the deadlock in both the CO2 regulation and the IAA, where France and Germany had been on opposite sides. The two countries stated that the components of the entire package should be adopted as soon as possible and simultaneously. The British government welcomed the potential inclusion of the United Kingdom in the "Made in Europe" regulations for vehicles.

"This is a German-French proposal, and there must still be a European process to go through, but if confirmed, we welcome the goal of including the United Kingdom in the 'Industrial Accelerator Act' - that would be good news for the British automotive industry as well as for the jobs and investments it secures throughout the United Kingdom," a Downing Street spokesperson said in a statement.

Should the German-French deal be signed, it must still be approved by the other EU member states and the European Parliament, which are currently discussing the "Industrial Accelerator Act" and the automotive package, including the emission targets for automotive manufacturers.