"The EU's car lie" — Germany's Bild tabloid newspaper didn't mince words when it reported on what it called the European Union's "dangerous" claim that electric vehicles were carbon neutral.

Markus Söder, the conservative state premier of Bavaria — home to major automotive brands like Audi, BMWand  Mercedes-Benz — was equally direct. Writing on social media, he called for an end to "the EU's phaseout of internal combustion engines" set for 2035. Stepping away from the phaseout, he said, would now be backed by "science."

Söder and Bild were reacting to a new report by the Technical University of Munich (TUM), which outlined what it considered to be a major flaw in the EU's climate strategy: the fact that its vehicle emissions regulation only focuses on CO2 emissions from exhaust gases and that battery-electric vehicles are considered "climate-neutral."

The report stated that battery-electric vehicles reduce carbon emissions by only "41% on average" over combustion engine vehicles, with the EU regulation failing to take into account emissions generated by other factors like manufacturing and electricity mix.

Gas-powered vehicles were at a disadvantage, the report concluded, suggesting emissions should be counted over a vehicle's entire life cycle, from the materials used to build a car to the fuel that makes it run. Credit could be given for the use of green steel, for instance, or recovering raw materials through recycling.

It highlighted several major car manufacturers that support this approach, including BMW, Audi and Volkswagen — all major institutional donors at TUM.

No new insights in TUM report

Georg Bieker, who researches the environmental impact of electric and gas-powered cars at the US-based International Council on Clean Transportation (ICCT) think tank, said TUM's analysis didn't offer any new insights. He, and other climate and mobility experts, pointed out that the importance of life-cycle assessments was already well known.

Bieker co-authored a 2025 study examining the global warming potential of passenger cars sold in the EU which took into account their entire life cycle, from the production of the vehicle to its fuel consumption and maintenance. It found that the emissions generated by battery-electric vehicles are on average 73% lower than gasoline cars, and up to 78% when using only renewable electricity. Similar studies, including from the EU and the International Energy Agency, came up with emissions reductions of between 60%-66%. The Germany Environment Ministry said modern vehicles could even achieve reductions of up to 80%.

Hybrid vehicles, meanwhile, which combine a combustion engine with an electric motor and battery charged by the car's brakes and an internal generator, generate fewer emissions than traditional cars, but still don't match fully electric vehicles.

Bieker said the full EV advantage will only grow as production and operation becomes less carbon intensive. Even today, he added, production emissions for gasoline internal combustion vehicles only account for around 13% of the total climate impact; most of the emissions come from the tailpipe.

Batteries have a high environmental cost

Bieker confirmed batteries were still one of the main environmental challenges facing electric cars. The mining of key resources like cobalt and lithium has been linked to habitat destruction and water depletion; mining 1 ton of lithium, enough for around 125 EVs, requires some 2 million liters of water.

Bieker's ICCT study found that while battery-electric vehicles had an estimated 40% higher production emissions than gas-powered vehicles due to battery production, these additional emissions were offset after driving about 17,000 kilometers (10,500 miles), or in one or two years. And, Bieker pointed out, most of those batteries could eventually be recycled — unlike the gasoline burned in a combustion engine.

"We see a trend of emissions decreasing for battery production," Bieker told DW, pointing out that technology was still being developed. The production of lithium-iron phosphate (LFP) batteries, for example, generates fewer emissions than the nickel manganese cobalt variety. LFPs are increasingly becoming the battery of choice for the industry — they're generally safer, last longer and are cheaper to manufacture.

Bieker said batteries were also increasingly being produced in Europe in larger, more efficient factories, which also helps reduce emissions generated by importing them from abroad. Though Europe still ranks second behind China when it comes to battery cell manufacturing, the European Commission has committed to boosting the sector with financial support, including a recent €1.5 billion in interest-free loans.

Renewable energy making the case for EVs

The other major factor contributing to EV emissions is the electricity mix — how the power charging the batteries is actually generated. While electric cars don't produce emissions during driving, they can generate them indirectly when charged using electricity produced by burning fossil fuels like coal and gas.

But the rapid expansion of renewable energy in recent years — especially solar, including a growing popularity of home installations — is increasingly tipping the scale in favor of EVs.

"Europe's electricity grid is currently more than 70% decarbonized and expected to be almost fully decarbonized by 2040," said Gabrielle Clark, a policy officer at European trade federation Eurelectric focusing on energy, climate and sustainability. "As the production of green steel and battery recycling capacity also ramps up as expected, this will only strengthen the case even more."

Clark said it wasn't necessary to replace the EU's current tailpipe emissions regulation, which plans to phase out combustion engines entirely by 2035, with more complex regulations and green accounting rules.

"Whether assessed through [life-cycle assessment] or tailpipe emissions, [battery-electric vehicles] are always the preferred technology for carbon emission reductions in the road transport sector," she told DW in an email. "Their replacement of [internal combustion engine] vehicles must be accelerated, not delayed."

Rising fuel prices, climate concerns push EV growth

Bieker said that in the end the market will decide, not policy.

"The future will be electric, no matter what European policymakers or German carmakers think," he said, highlighting the global growth of EV sales in recent years, especially in China and Southeast Asia.

EVs are also taking off in Europe. In Germany, for example, a new survey by research firm SBD Automotive and Here Technologies showed that 54% of respondents were more likely to consider buying an electric car as their next vehicle, citing technology advances, rising fuel prices and environmental concerns.

"We cannot win the race by ignoring it," said Bieker. "[For climate,] for competitiveness and economic development, we need to double down on electrification and not slow it down."

Edited by: Tamsin Walker