French President Emmanuel Macron and German Chancellor Friedrich Merz are reportedly working toward a shared goal of easing the European Union's 2035 ban on new internal combustion engine (ICE) vehicles, according to the German newspaper Handelsblatt. The proposal, based on information from three sources close to the discussions, would allow for a further reduction in the emission reduction targets for car manufacturers. This would lower the required effort by an additional 10 points compared to the 10-point flexibility already proposed by the European Commission. Unlike the current plan, which would require compensation through low-carbon steel, e-fuels, or biofuels, the new proposal would not impose such requirements, potentially allowing more ICE and hybrid vehicles to remain on the market after 2035. The original European rule required a 100% reduction in average CO2 emissions from new cars by 2035 compared to 2021, effectively ending the sale of new gasoline or diesel cars. In December 2025, the European Commission proposed reducing this target to 90%, with the remaining 10% to be compensated by low-carbon materials and alternative fuels. This would allow for the continued sale of non-all-electric vehicles, including hybrids and some ICE vehicles. The Franco-German proposal would further reduce the required effort, potentially increasing the share of non-electric vehicles after 2035. Under the European Commission's current proposal, about 27 to 29% of new vehicle registrations could still involve ICE vehicles after 2035, depending on the use of flexibility mechanisms. An additional relaxation could increase this proportion further, making the term "ban on internal combustion engines by 2035" less accurate. Paris and Berlin are also seeking to give manufacturers more time before 2035. The current legislation requires a 55% reduction in average CO2 emissions from new cars by 2030 compared to 2021. France's position has evolved since earlier this year, when it and Spain had opposed any revisions that might call into question the zero-emission target. However, France now appears to be seeking a broader compromise with Germany, which is seeking more flexibility on CO2 targets to ease its automotive industry. France and Germany are reportedly negotiating a "give and take" arrangement, where France would accept more flexibility on ICE vehicles in exchange for German support for stricter "Made in Europe" rules, aimed at protecting European manufacturers against Chinese competition. France already applies this logic to its own subsidies, which are conditional on the vehicle and its battery being manufactured in Europe. Electric vehicle sales in Europe have been accelerating. In the first eight months of 2026, fully electric models accounted for 21.7% of new cars sold in the European Union, compared to 15.8% a year earlier, according to the European Automobile Manufacturers Association (ACEA). In France, electric vehicles reached a record level in September with 42% of new car registrations, compared to 31% since the beginning of the year. In Germany, electric vehicles accounted for 34.5% of new registrations in September, also a record, compared to 27.2% over the first nine months of the year. Chinese vehicles are representing an increasingly significant share of electric vehicles sold in Europe.