The EU decision leaves the door open for other zero-emission technologies as well. Passenger carmakers will be required to cut their new-car tailpipe emissions by 55% before 2030 – compared to 2021 levels – before a total cut-off from 2035. This creates the potential for developing carbon-neutral fuels such as hydrogen and biofuels or synthetic petrol and diesel a.k.a. e-fuels. The EU has also given carmakers producing less than 10,000 vehicles annually, an extra year – till 2036 – to meet new emissions rules. This regulation is a definitive step towards the transition of the automotive sector.
India needs to start planning the transition for its own automotive sector, particularly its auto component manufacturers. It must also explore non-EV options for zero-emissions vehicles. India has taken steps towards developing e-fuels, but these are blended fuels with 5% and 20% ethanol. It must ensure that it does not become the destination for ICE vehicles that are being phased out in Europe. Instead, it should focus on becoming part of the manufacturing ecosystem for zero-emission vehicles. This will help secure market share to meet growing demand and in becoming a manufacturing hub as countries move away from traditional ICE to nicer options of transit.
