EU Reverses 2035 Internal Combustion Engine Ban Amid Global EV Transition Slowdown

**AI PRISM: Personalized Economic Briefing for Global Investors**

*Editor's note: AI PRISM (Personalized Report & Insight Summarizing Media) is an AI-based customized news recommendation and summary service developed with support from the Korea Press Foundation. It selects and provides six tailored news items by reader type.*

**Key Issue Briefing**

**Global EV Transition Pace Adjustment**

The European Commission has effectively withdrawn its plan to ban internal combustion engine vehicle sales from 2035, slowing the pace of electric vehicle transition. Ford has also decided to significantly scale back its EV business after investing $19 billion (28 trillion won), signaling that the global automotive industry's EV transition strategy is entering a recalibration phase. Hybrid and internal combustion engine parallel strategies are regaining attention.

**Korea-UK FTA Upgrade**

South Korea and the United Kingdom have concluded negotiations to upgrade their free trade agreement, opening the UK high-speed rail market to Korean companies. The agreement secures opportunities for Korean firms to participate in British rail project bids, with bilateral trade expansion and infrastructure cooperation expected to accelerate.

**Korean Won Weakness Persists**

The won-dollar exchange rate is threatening the 1,480 won level again, with foreign exchange market instability continuing. The Ministry of Economy and Finance convened an emergency response meeting with major exporters including Samsung Electronics (005930.KS) and Hyundai Motor (005380.KS), but the Korean won remains under pressure amid the strong dollar and US interest rate hike trajectory.

**News for Global Investors**

**1. Europe Also Hesitates: 2035 ICE Ban Effectively Scrapped**

The European Commission has effectively withdrawn its plan to completely ban internal combustion engine vehicle sales from 2035. The EU had originally pursued regulations requiring all newly sold vehicles to be zero-emission from 2035, but revised the policy considering pushback from the automotive industry and economic burden. Accordingly, hybrid and internal combustion engine vehicle sales are expected to be partially permitted after 2035, with experts analyzing that the global automotive industry's EV transition will be slower than initially expected.

**2. UK High-Speed Rail Market Opens, Automotive Tariff-Free Range Expands**

South Korea and the United Kingdom have concluded FTA upgrade negotiations, opening the UK high-speed rail market to Korean companies. The agreement secures opportunities for Korean firms to participate in major infrastructure project bids including the UK's HS2 (High Speed 2) project. The two countries also agreed to strengthen cooperation in digital trade and supply chain sectors, with experts forecasting that the FTA upgrade will boost Korean rail and infrastructure companies' expansion into the European market.

**3. Doosan Enerbility to Supply 5.6 Trillion Won Nuclear Components to Czech Republic**

Doosan Enerbility (034020.KS) has signed a contract worth 5.6 trillion won ($4.1 billion) to supply main equipment and turbines for the Dukovany Nuclear Power Plant Units 3 and 4 construction project in the Czech Republic. This contract represents a landmark order symbolizing the Korean nuclear industry's expansion into Europe. Doosan Enerbility will supply core components including reactor pressure vessels, steam generators, and pressurizers. The Czech government has reversed its nuclear phase-out policy and shifted to nuclear expansion, with Doosan Enerbility expected to strengthen its position in the European nuclear market through this order.

**Reference News for Global Investors**

**4. As Trump Wished: Ford Effectively Abandons $19 Billion EV Business**

US automaker Ford has decided to significantly scale back its EV business after investing $19 billion (approximately 28 trillion won). Ford changed course to halt development of its EV-dedicated platform and focus on hybrid vehicle production, influenced in part by US President-elect Donald Trump's pledge to abolish EV subsidies. The global automotive industry's EV transition pace is being adjusted accordingly, with experts forecasting that hybrid vehicles will serve as a bridge between internal combustion engines and EVs for the time being.

**5. Won Threatens 1,480 Level Again Despite Finance Ministry Summoning Samsung, Hyundai**

The won-dollar exchange rate is threatening the 1,480 won level again, with foreign exchange market instability continuing. The Ministry of Economy and Finance urgently convened officials from major exporters including Samsung Electronics and Hyundai Motor to discuss exchange rate stabilization measures, but the Korean won remains under pressure as the US Federal Reserve's high interest rate policy and strong dollar trend continue. Experts note that the exchange rate could potentially breach 1,500 won if the Fed slows its pace of rate cuts.

**6. Paradox of Excessive Rate Intervention: US Low-Income Lending Down 20%**

Lending access for low-credit borrowers in the United States has decreased by 20% due to strengthened interest rate cap regulations. Some state governments introduced interest rate caps restricting high-interest loans, but this has had the adverse effect of pushing low-credit borrowers away from legitimate financial institutions and into illegal loan shark markets. Experts point out that excessive interest rate regulation is failing to protect financially vulnerable groups, and policies that balance financial inclusion with consumer protection are needed.