EU's von der Leyen announces initiative to make cars more affordable

Wed, Sep 10, 2025, 6:14 AM 1 min read

European Commission President Ursula von der Leyen on Wednesday announced an initiative for small, affordable cars in collaboration with the auto industry.

"Millions of Europeans want to buy affordable European cars," said von der Leyen in a speech to the European Parliament in Strasbourg, France.

"We should invest in small affordable cars, both for the European market, but also to meet the surge that we see in the global demand," she added.

Compared to their competitors from China, European manufacturers have so far only offered relatively expensive electric cars.

Von der Leyen did not detail if the initiative will be restricted to battery-powered cars but she stressed that "the future will be electric, and Europe will be a part of it."

"The future of cars and the cars of the future must be made here in Europe," she added.

The commission president also announced a package that will provide €1.8 billion ($2.1 billion) for battery production in Europe.

Batteries are key enablers of clean tech, especially electric vehicles, she said.

Von der Leyen also reaffirmed that EU climate targets for cars will be reviewed, after increased pressure to reverse a ban of combustion engine cars from 2035 from some EU countries and business representatives.

The EU decision on the combustion engine phase-out stipulates that from 2035, no new cars with petrol or diesel engines will be allowed to be registered in order to reduce carbon-dioxide emissions in the transport sector.