Germany on the Wrong Way – Shaking the Combustion Engine Phase-Out Is Counterproductive

The debate over the future of the automotive industry in Germany has reached a critical point. With Chancellor Friedrich Merz advocating for the overturning of the 2035 ban on internal combustion engines (ICEs) across the EU, many are asking whether this move is economically wise or strategically sound. Carwow CEO Philipp Sayler von Amende provides an in-depth perspective on why this decision could send the wrong signal to the automotive market and consumers alike.

The Context: Chancellor Merz and the 2035 ICE Phase-Out

Germany’s automotive industry has long been a cornerstone of the national economy, responsible for millions of jobs and a significant share of exports. However, the rise of electric vehicles (EVs) has forced both policymakers and manufacturers to rethink strategies. In this context, the Chancellery’s recent car summit—held without including key stakeholders in the mobility sector—aimed to address the country’s automotive future but has sparked debate instead of consensus.

Chancellor Merz expressed intentions to advocate for an overturning of the 2035 ICE ban at the EU level, citing concerns that the transition to electric mobility could weaken Germany’s traditional automotive industry. While this move might appear protective of domestic jobs and industrial capacity, industry experts warn that it could backfire by slowing the adoption of electric vehicles and introducing market uncertainty.

Carwow CEO’s Perspective: Philipp Sayler von Amende Speaks Out

Philipp Sayler von Amende, CEO of Carwow Germany, commented on the summit outcome, emphasizing that withdrawing the 2035 ban is not only politically questionable but economically counterproductive. According to Sayler von Amende, the data clearly shows that consumer interest in electric vehicles is growing steadily. In September alone, one-fifth of all newly registered passenger cars in Germany were battery electric vehicles (BEVs).

This trend highlights a significant shift in consumer preference. Electric vehicles are no longer a niche market; they are becoming mainstream. A sudden reversal of the 2035 ICE ban risks undermining this momentum, creating uncertainty among buyers, manufacturers, and suppliers. Electromobility, he argues, requires reliability, predictability, and a clear roadmap for long-term success.

Why Overturning the Ban Could Be Harmful

The potential risks of overturning the 2035 ICE phase-out are multifaceted:

• Market Uncertainty: A sudden policy reversal would unsettle both consumers and manufacturers, making investment decisions more complex and risky.
• Slowed EV Adoption: Delaying the phase-out could dampen consumer confidence in electric vehicles, slowing their market penetration.
• International Competitiveness: Other European countries are maintaining their timelines for EV adoption. Germany could fall behind if it weakens its commitment to electrification.
• Environmental Impact: Postponing the shift to electric vehicles could have serious environmental consequences, as ICE vehicles continue to emit greenhouse gases at a high rate.

Sayler von Amende emphasizes that the grace period demanded today for ICE vehicles could inadvertently turn into a broader grace period that threatens the competitiveness and modernization of the German car industry itself.

Learning from International Examples: The UK Case

Other countries provide valuable lessons on managing the transition to electric mobility pragmatically. The United Kingdom, for instance, maintains its 2035 ban on new gasoline and diesel cars, providing a clear target for both manufacturers and consumers. At the same time, the UK introduces flexibility through:

• Allowance for hybrid vehicles.
• Special exceptions for certain Original Equipment Manufacturers (OEMs).
• Credit transfers and incentive programs to ease the transition.

This approach strikes a balance between ambition and realism. It encourages innovation and investment in EV technology while still providing room for industry adaptation. Germany could adopt similar measures to ensure a smooth transition without sacrificing industrial competitiveness.

Positive Policy Signals: Incentives for Electric Vehicles

Rather than focusing on postponing deadlines, Sayler von Amende suggests that policy efforts should concentrate on strengthening market incentives for electric vehicles. The recent announcement by the German coalition to provide €3 billion for new EV incentives represents a positive signal. These incentives aim to:

• Accelerate the transition to electric vehicles.
• Make EVs more affordable for middle- and low-income drivers.
• Stimulate demand, boosting production and innovation.

By prioritizing incentives over delays, policymakers can support both the industry and consumers, creating a win-win scenario that promotes environmental sustainability while maintaining economic growth.

The Growing Market for Electric Vehicles in Germany

Data from the past few years demonstrates that electric vehicle adoption is not just a trend but a structural shift. In 2025, BEVs accounted for nearly 20% of new passenger car registrations, a significant increase from previous years. As infrastructure improves and battery technology advances, this trend is expected to continue.

The German automotive market is also experiencing increased consumer demand for used electric vehicles. Platforms like Carwow facilitate direct sales from individuals to certified dealers, making the process smoother and more transparent. For private sellers, this growing interest represents an opportunity to maximize resale value while contributing to the broader electrification movement.

Why Consistency Matters for Electromobility

Electromobility thrives on predictable policies and clear regulatory frameworks. Investors, manufacturers, and consumers all need certainty to plan long-term strategies. Frequent policy reversals or sudden changes can have far-reaching consequences, such as:

• Delaying infrastructure investments for charging stations.
• Reducing consumer confidence in EV technology.
• Increasing operational risks for manufacturers planning EV production lines.

Sayler von Amende underscores that instead of lobbying for ICE postponement, the focus should be on strengthening market confidence, supporting innovation, and ensuring Germany remains competitive on the global stage.

Economic and Environmental Benefits of the Phase-Out

Transitioning to electric vehicles offers both economic and environmental advantages:

• Lower Emissions: BEVs produce zero tailpipe emissions, contributing to cleaner air and reduced greenhouse gas output.
• Technological Leadership: Investing in EV production positions Germany as a leader in next-generation automotive technologies.
• Job Creation: Growth in EV manufacturing, battery production, and charging infrastructure can generate new employment opportunities.
• Energy Efficiency: Electric vehicles are generally more energy-efficient than ICE vehicles, reducing overall fuel costs for consumers.

Delaying the ICE phase-out risks forfeiting these benefits, potentially slowing Germany’s progress toward climate goals and sustainable economic growth.

Conclusion: A Clear Roadmap for Germany’s Automotive Future

The future of the car industry in Germany is electric. While the concerns of traditional manufacturers are valid, overturning the 2035 ICE ban would likely produce more harm than good. According to Carwow CEO Philipp Sayler von Amende, the key elements for a successful transition are:

• Maintaining predictable regulations and deadlines.
• Providing incentives and support for EV adoption.
• Learning from international examples to balance ambition with realism.
• Encouraging transparency and clarity for both manufacturers and consumers.

Germany has the opportunity to lead in electric mobility while protecting its automotive industry. By focusing on incentives and predictable policies rather than reversing phase-out plans, policymakers can ensure that the country’s automotive sector remains competitive, innovative, and sustainable for decades to come.

FAQs: Germany’s ICE Phase-Out and Electric Vehicles

Why is the 2035 ICE ban important?

The 2035 ICE ban sets a clear timeline for phasing out new gasoline and diesel vehicles. It provides certainty for manufacturers, encourages EV adoption, and helps Germany meet its environmental and climate targets.

What could happen if Germany reverses the ban?

Reversing the ban could create market uncertainty, slow down EV adoption, jeopardize environmental goals, and reduce Germany’s competitiveness in the global automotive industry.

How can Germany balance industry needs with environmental goals?

Germany can follow international examples like the UK, combining firm deadlines for ICE bans with flexibility such as hybrid allowances, OEM credits, and transitional policies, ensuring both industry adaptation and environmental progress.

What role do incentives play in EV adoption?

Incentives make EVs more affordable and attractive, accelerating adoption among a broader consumer base. They can stimulate demand, encourage investment in production, and support the transition to sustainable mobility.

How does consumer confidence affect the EV market?

Stable and predictable policies build consumer confidence. Buyers are more likely to invest in electric vehicles when they trust that regulations, incentives, and infrastructure will support their long-term ownership.