Porsche and Volkswagen adopt new strategies to meet EU CO2 targets

Porsche and Volkswagen are implementing strategies to mitigate heavy EU fines related to fleet-wide CO2 emission targets. Porsche has announced it will leave the Volkswagen Group’s shared CO2 pool to enter a partnership with Chinese electric vehicle manufacturer Xpeng for 2026 and 2027. This move allows Porsche to offset its increasing sales of internal combustion engine models by pooling emissions with Xpeng, which exclusively sells electric vehicles in Europe.

Volkswagen is also addressing its emissions gap through a combination of regulatory shifts and new product launches. While the group’s fleet emissions in the first half of 2026 were approximately 100 grams per kilometer—exceeding the EU target of 92 grams—a 2025 EU rule allows manufacturers to average emissions across the years 2025 to 2027. This prevents immediate multi-billion euro penalties.

Additionally, Volkswagen is seeing strong demand for a new family of affordable electric vehicles, including the ID. Polo, Cupra Raval, Skoda Epiq, and VW ID. Cross. These models, which utilize cheaper LFP batteries, have secured over 70,000 pre-orders in three months, helping to lower the group's overall average emissions.