Ban on new diesel and petrol cars threatens EU sovereignty in the automotive sector

The European Court of Auditors has warned that a ban on the sale of new petrol and diesel cars from 2035 could threaten European leadership due to a lack of competitiveness, particularly in battery production.

In a report published this Monday, the European Court of Auditors (ECA) highlights a possible clash between the European Green Pact and the “industrial sovereignty” of the European Union (EU), with a focus on electric vehicles.

The ECA found that despite greater public support, batteries produced in the EU “continue to cost much more than expected”, which is affecting the competitiveness of European electric vehicles compared to other global manufacturers and could also “lead to European electric vehicles will not be within reach of a large portion of the population.”

Less than 10% of global battery production is concentrated in Europe, the text highlights, with the vast majority produced in China.

The EU’s battery sector depends on imports of resources from external countries with which the bloc has no relevant trade agreements: 87% of raw lithium comes from Australia, 80% of manganese from South Africa and Gabon, 68% of cobalt from the Democratic Party. Republic of Congo and 40% of graphite from China, the institution says.

TCE also warns that vehicle charging infrastructure still poses many obstacles, either due to supply shortages or the lack of harmonized means of payment.

Given the challenges faced in reducing greenhouse gas (GHG) emissions from the road sector, as well as the weak development of biofuels, the EU is betting on electric vehicles as the best possible alternative.

Reducing or eliminating CO2 emissions from passenger cars is an important element of the European climate strategy, which aims to achieve net-zero greenhouse gas emissions by 2050, the year the EU is expected to achieve carbon neutrality.