Headlines:
- US launches Section 301 investigations into global manufacturing overcapacity, including EU transport industries
- ReFuelEU Aviation debate highlights international tensions over aviation decarbonisation
- Geopolitical tensions raise questions over enforcement of global aviation climate scheme
- Oil and gas sector calls for ‘stop the clock’ on EU methane rules
- Transitional shipping fuels risk delaying ammonia shift without stronger policy signals, study says
- Zero-emission trucks and buses gain ground in Europe as CO₂ standards take effect
- Electric car share holds at 19% in Europe as combustion sales decline
- BEV sales approach tipping point in Europe as prices fall and targets drive market growth
- French ports warn EU rules risk diverting maritime traffic to non-EU hubs
- Spanish €200m EV manufacturing aid cleared under Clean Industrial Deal framework
- OECD report outlines governance roadmap for scaling book-and-claim systems in transport decarbonisation
- Report says £5.3bn in developer funds remains unused by UK local authorities
US launches Section 301 investigations into global manufacturing overcapacity, including EU transport industries
The United States has launched broad trade investigations into structural excess capacity across global manufacturing sectors, targeting a wide group of economies including the European Union and several key partners in Asia and North America.
The investigations were initiated on March 11th by the Office of the United States Trade Representative under Section 301 of the Trade Act of 1974. The process will examine whether policies adopted by trading partners have created persistent excess production capacity that burdens or restricts US commerce.
The notice frames structural excess capacity as a situation in which industrial production capacity significantly exceeds domestic or global demand and is sustained through government intervention, including subsidies, state ownership, market access barriers or other industrial policies that encourage production beyond market conditions.
The investigation covers a broad list of economies including China, the European Union, Japan, Korea, India and several Southeast Asian manufacturing hubs.
Transport and mobility industries feature prominently among the sectors cited by the United States. The notice identifies automobiles, transportation equipment, batteries and shipbuilding among the manufacturing sectors affected by global overcapacity, alongside steel, semiconductors and machinery.
In the case of the European Union, the notice adopts a notably critical tone. The investigation states that the EU maintains a global goods trade surplus led by exports in sectors including machinery, vehicles and chemicals. According to the US analysis, the EU recorded a goods trade surplus of approximately $451 billion in 2024, alongside a bilateral surplus with the United States of $147 billion.
Germany is highlighted in particular due to its long standing manufacturing surplus. The notice states that German production levels have remained consistently above domestic demand, with the country recording a goods trade surplus equivalent to 5.6 percent of GDP in 2024. Automotive exports are identified as a major contributor to this surplus.
The document also argues that parts of the European automotive sector may already suffer from excess industrial capacity. According to the US notice, European automotive factories are operating at approximately 55 percent capacity utilisation, suggesting that additional manufacturing investment could exacerbate existing global imbalances.
These references appear aimed in part at ongoing developments in the global electric vehicle industry. The notice highlights the international expansion of Chinese carmakers, citing the overseas manufacturing strategy of Chinese manufacturer BYD, which has established production facilities in countries including Hungary and Turkey. The investigation suggests that such investments could further expand global automotive production capacity beyond underlying demand.
China remains the central focus of the investigation. The notice states that China recorded a global goods trade surplus exceeding $1.2 trillion in 2025, accounting for nearly 70 percent of global goods trade surpluses. Several sectors linked to transport supply chains are cited as examples of potential overcapacity, including steel, batteries and automotive manufacturing.
The investigations are part of a broader US effort to address global industrial imbalances and to support domestic manufacturing capacity. According to the notice, global manufacturing capacity utilisation remains below levels considered healthy for many sectors, indicating that production capacity in several economies exceeds global demand.
The Section 301 process allows the United States to determine whether the policies of foreign governments are unreasonable or discriminatory and whether they burden US commerce. If such findings are made, the administration may adopt trade measures including tariffs or other restrictions.
Public hearings related to the investigations will begin on May 5th in Washington, with written submissions from stakeholders due by April 15th. The process will involve consultations with the governments of the economies under investigation before the US administration decides whether trade action is warranted.
ReFuelEU Aviation debate highlights international tensions over aviation decarbonisation
Debate over the enforcement of the EU’s ReFuelEU Aviation regulation has intensified in Brussels following recent reports suggesting that the European Commission may adopt a pragmatic approach to penalties for the supply of synthetic sustainable aviation fuel.
The discussion centres on the regulation’s enforcement provisions that apply to fuel suppliers who fail to meet the future sub-mandate for eSAF. Under the legislation, suppliers must progressively increase the share of sustainable aviation fuel delivered at EU airports, including a dedicated mandate for synthetic fuels beginning later in the decade.
Responding to questions on the issue, a Commission spokesperson said the objective of the regulation is “to ensure the uptake and availability of e-SAF, not to collect penalties,” adding that the Commission remains fully committed to the implementation of ReFuelEU Aviation and to supporting the scale-up of production through EU funding instruments and mechanisms such as double-sided auctions.
“The penalty system, and the obligation to supply the missing quantities of SAF and eSAF in subsequent years, are key design features of the Regulation intended to ensure compliance,” the spokesperson said.
In a separate communication, the Commission reiterated that enforcement mechanisms under ReFuelEU Aviation are intended to ensure compliance, support the development of a robust SAF and eSAF market, and maintain regulatory stability and investor confidence.
The exchange comes as the international governance of aviation decarbonisation remains contested. The EU currently limits the scope of its emissions trading system for aviation to intra-European flights while international emissions are addressed through the global Carbon Offsetting and Reduction Scheme for International Aviation developed under the International Civil Aviation Organization.
Some stakeholders argue that the reliance on offsetting under the global scheme risks delaying investment in zero-emission aviation fuels and weakening incentives to scale up synthetic fuel production.
The geopolitical dimension has also gained prominence in recent multilateral discussions. In parallel negotiations at the International Maritime Organization on a global net zero framework for shipping, the United States has recently opposed stronger climate measures and pushed back against proposals to introduce binding global pricing mechanisms for maritime emissions.
Geopolitical tensions raise questions over enforcement of global aviation climate scheme
The international governance framework underpinning the Carbon Offsetting and Reduction Scheme for International Aviation is facing increased scrutiny as geopolitical tensions raise questions about the durability of the global aviation climate regime.
From 2027, the scheme is scheduled to move from its voluntary phase into mandatory application across most contracting states of the International Civil Aviation Organization, with exemptions for least developed countries, small island developing states, landlocked developing states and smaller aviation markets. This transition would extend coverage to most international flights and coincide with the participation of additional major aviation markets.
However, the scheme’s governance structure remains dependent on national implementation. The International Civil Aviation Organization does not possess centralised sanctioning powers, meaning compliance relies on enforcement by individual states.
Attention has increasingly focused on the geopolitical dimension of the mechanism, particularly the role of the United States. While the US currently participates in the scheme, the administration has recently questioned its engagement in several multilateral climate initiatives.
This dynamic has been visible in parallel negotiations at the International Maritime Organization, where the United States opposed elements of the proposed global net zero framework for shipping and resisted proposals to introduce binding international measures to reduce greenhouse gas emissions from the maritime sector.
Observers note that uncertainty surrounding the participation of major aviation economies could affect the scope of the global mechanism as it enters its mandatory phase. Estimates shared with the Green Mobility Magazine suggest that if large aviation markets do not fully participate, the share of global aviation emissions covered by the scheme could decline significantly during the next decade.
Oil and gas sector calls for ‘stop the clock’ on EU methane rules
Oil and gas industry groups are calling on the European Union to introduce a “stop the clock” mechanism to delay the implementation of the EU Methane Regulation, warning that importer obligations under Article 28 could disrupt energy and transport fuel supply from 2027.
Article 28 introduces new requirements for importers of natural gas, LNG and crude oil entering the EU market. From January 2027, importers must demonstrate that exporting countries or producing companies apply methane monitoring, reporting and verification standards equivalent to those required under EU law.
Industry organisations argue that the Article 28 provisions may prove difficult to implement within the current timeframe. They note that no exporting country has yet been recognised as MRV-equivalent to the EU framework, while only a limited share of global production currently meets the producer-level reporting pathway based on OGMP 2.0 Level 5 reporting and verification.
According to industry analysis, this could create a compliance-driven supply constraint affecting both gas and oil imports into the European Union. Estimates cited by the sector suggest that up to 43 percent of EU gas imports and 87 percent of crude oil imports could face compliance risks under the current Article 28 design.
For transport markets, the main concern is the impact on crude availability and refining. Industry modelling suggests that EU refinery throughput could decline by around 50 percent between 2027 and 2030 if sufficient compliant crude is not available, increasing dependence on imported refined products and weakening domestic fuel supply resilience.
The sector also points to the potential price effects. On the gas side, reduced availability of compliant imports could tighten the market and raise wholesale gas prices. On the oil side, constrained access to compliant crude could raise feedstock costs for European refiners and push up the price of transport fuels. Industry estimates suggest gasoline prices could rise by around 24 percent and diesel prices by around 16 percent under a strict implementation scenario.
For road freight and other diesel-reliant transport segments, higher diesel prices would feed directly into operating costs and supply chains. The sector also argues that a reduction in EU refining capacity would have wider implications for fuel security, industrial competitiveness and Europe’s ability to maintain a domestic supply of key transport fuels.
Industry groups are therefore calling for a temporary pause in the implementation of Article 28 in order to allow time for workable equivalency decisions, traceability systems and third-party verification arrangements to be developed without altering the broader methane reduction objective.
Transitional shipping fuels risk delaying ammonia shift without stronger policy signals, study says
A study by researchers at the UCL Energy Institute questions whether widely promoted transitional fuels for maritime shipping genuinely facilitate a shift to zero-carbon fuels, warning that current investment patterns risk delaying rather than enabling deep decarbonisation of the sector.
The working paper examines whether liquefied natural gas (LNG) and methanol can function as “stepping stones” toward ammonia-powered shipping, which the authors identify as one of the most promising long-term fuel options for eliminating carbon emissions from maritime transport. The analysis concludes that neither LNG nor methanol investments currently provide a direct technological bridge to ammonia and may instead reinforce fossil-based infrastructure unless policy frameworks change.
Shipping faces growing pressure to reduce greenhouse gas emissions as regulators and industry bodies seek pathways to align the sector with global climate targets. Within discussions at the International Maritime Organization, ammonia has increasingly been identified as a potential long-term fuel because it contains no carbon at the point of combustion and can theoretically be produced using renewable electricity.
However, ammonia deployment faces significant barriers in the near term. These include safety concerns linked to toxicity, uncertainty over regulatory standards and the lack of dedicated infrastructure. As a result, parts of the shipping industry have promoted LNG and methanol as transitional fuels capable of delivering near-term emissions reductions while allowing a later shift to ammonia.
The study challenges this narrative. Using interviews with industry stakeholders, patent analysis and shipping fleet data, the researchers find limited physical or economic overlap between existing LNG or methanol investments and the infrastructure required for ammonia fuel systems.
Methanol, the analysis finds, provides little direct technological foundation for an ammonia transition. Storage systems, fuel supply infrastructure and upstream production pathways for methanol do not easily translate to ammonia operations, meaning vessels designed for methanol would require extensive modifications comparable to those needed for conventional fuel ships.
LNG presents somewhat greater potential for compatibility because both LNG and ammonia involve cryogenic fuel storage. But the study finds that most LNG investments currently being made are not designed in a way that allows cost-effective conversion to ammonia. Ships described as “ammonia ready” may in practice require significant additional redesign to accommodate ammonia’s greater toxicity, different fuel preparation requirements and heavier storage systems.
The authors argue that LNG could function as a genuine stepping stone only if ships and bunkering infrastructure were built to robust ammonia-ready specifications. Without such design standards, LNG investments risk locking capital into infrastructure that discourages later transitions.
The paper also warns that investment in transitional fuels may divert financial resources from ammonia development. Because shipowners already pay a premium for LNG or methanol vessels, they may be reluctant to undertake another costly retrofit if those fuels remain compliant with emissions regulations.
The authors conclude that stronger and more credible long-term emissions policy signals would be required to make ammonia-ready investments economically attractive. Without such signals, they argue, the maritime sector risks committing to transitional pathways that slow the shift toward zero-carbon shipping.
Zero-emission trucks and buses gain ground in Europe as CO₂ standards take effect
Sales of zero-emission heavy-duty vehicles in Europe increased sharply in 2025, reaching more than 23,700 registrations and marking a significant expansion in the early-stage transition of the truck and bus sector.
New data published by the International Council on Clean Transportation show that zero-emission vehicles accounted for 4.5% of truck sales and 24.8% of bus and coach sales across the EU-27 in 2025. The figures represent a marked increase from 2024, when the respective shares stood at 2.5% for trucks and 18.5% for buses.
The growth comes despite an overall contraction in the heavy-duty vehicle market. Total truck and bus registrations declined by around 5% in 2025, falling to roughly 350,000 units from 370,000 the year before. Nevertheless, sales of zero-emission vehicles expanded rapidly, indicating a gradual shift in the market mix.
Urban buses remain the most advanced segment of the transition. In 2025, 58% of newly sold city buses were zero-emission vehicles, up from 45% the previous year. Overall, nearly one in four buses and coaches sold in the EU was zero-emission, reflecting growing uptake among public transport operators.
By contrast, long-distance and interurban buses continue to lag. Their zero-emission sales share remained at roughly 4% in both 2024 and 2025, highlighting the continued technological and operational barriers associated with longer routes.
The medium truck and van segment, covering vehicles between 3.5 and 12 tonnes, recorded the fastest expansion. Zero-emission models accounted for 21% of sales in 2025, more than double the 10.4% share recorded in 2024. Over the past three years, sales of zero-emission vehicles in this category have increased roughly tenfold.
Much of this growth is concentrated in the van segment, where more than half of sales were zero-emission in 2025. By contrast, medium trucks themselves remain largely diesel powered, with zero-emission vehicles accounting for only about 3% of that sub-segment.
Heavy trucks weighing over 12 tonnes are still in the early stages of electrification. Of the approximately 263,000 heavy trucks sold in the EU in 2025, fewer than 5,000 were zero-emission vehicles, corresponding to a 1.9% sales share. However, the pace of adoption accelerated in the second half of the year, with the share reaching 2.7% in the fourth quarter.
The increase coincided with the introduction of tighter CO₂ reduction requirements for truck manufacturers. New heavy trucks registered between mid-2025 and mid-2026 must emit 15% less carbon dioxide than comparable models registered between 2019 and 2020.
Among manufacturers, Mercedes-Benz Group emerged as the largest supplier of zero-emission heavy trucks in the EU during 2025. Sales of its eActros model rose sharply in the second half of the year, reaching roughly 1,400 units and significantly increasing the company’s share of the segment.
Other major manufacturers recorded far more modest progress. The share of zero-emission heavy truck sales remained around 3% for Renault Trucks and roughly 2% for Volvo Trucks, while most other producers registered shares below 1%.
Geographically, adoption remains uneven. Northern European markets showed the strongest uptake of zero-emission heavy trucks in the final quarter of 2025, including the Netherlands, Denmark and Sweden, while adoption in many southern and eastern markets remains limited.
The report also highlights the growing global competitive dimension of the sector. While Europe recorded roughly 24,000 zero-emission heavy-duty vehicle registrations in 2025, China registered more than 450,000 such vehicles in the same year, corresponding to a market share exceeding 25%.
