The European Union is reportedly drafting legislation that could force rental and corporate car fleets to transition to electric vehicles (EVs) by 2030. According to Bild, the directive is being quietly discussed by the European Commission and may be introduced by late summer. This proposal is intended to expedite the bloc’s green transition and enforce its 2035 combustion-engine ban. Car manufacturers have expressed concerns, arguing that the initiative is too expensive and would necessitate major overhauls of existing production lines.
The regulation is seen as a backdoor to accelerate the green transition and enforce the bloc’s combustion-engine ban, which mandates a 100% cut in CO2 emissions from new cars by 2035, effectively outlawing gasoline and diesel vehicles. Car manufacturers have criticized the plan as too costly and requiring full conversions of production lines.
The new rules will reportedly apply to all rental companies and businesses with car fleets across the bloc. If approved, such entities will only be allowed to purchase EVs, thus impacting around 60% of new car sales, Bild said. A Commission spokesperson confirmed that work is underway on such a plan but declined to provide details.
Lawmakers warn the measure could harm Europe’s rental sector: companies such as Enterprise, Hertz, and Sixt already scaled back EV fleets in 2024, citing poor charging infrastructure, high repair costs, and weak resale values. EU MP Markus Ferber urged the Commission to drop the plan, calling it “unrealistic.” Sixt CEO Nico Gabriel agreed, warning that few vacationers rent EVs and that mandatory electrification would drive up rental costs due to charging infrastructure needs.
Critics say Europe’s green push is straining its auto industry and wider economy. Carmakers face penalties if they fail to boost EV sales and must spend heavily on new production lines, batteries, chargers, and grid upgrades. The transition also threatens jobs: automaker Stellantis warned this month it could close plants if it fails to meet EU deadlines. Former EU commissioner Thierry Breton warned the shift to EVs could cost 600,000 jobs.
Manufacturers have called for subsidies and state support to avoid losing more market share to rivals in China and the US.
Other sectors face similar problems, especially as Brussels phases out Russian energy, imports of which have dropped sharply in light of Ukraine-related sanctions. Russian officials have warned that rejecting its supplies will force the EU to rely on costlier alternatives or rerouted Russian energy via intermediaries.