Investing.com -- European Union lawmakers reached an agreement to reduce proposed car emissions requirements for 2035, permitting automakers to use low-carbon EU steel to meet part of the targets, Reuters reported Tuesday.

The European Commission proposed last year that automakers reduce CO2 emissions by 90% from 2021 levels in 2035, down from an earlier target of 100%. The EU executive said the remaining 10% could be offset through use of low-carbon steel and alternative fuels.

The agreement among three mainstream party groups in the European Parliament establishes a target of an 87.5% reduction for cars, with a 7.5% addition from production using low-carbon steel manufactured in the European Union.

The deal requires approval from the centre-right European People's Party, the centre-left Social Democrats and the more centrist Renew to establish the European Parliament's position.

The parliament and EU governments must then negotiate a common text on emissions targets for new car fleets for 2030 and 2035.

EU countries have previously supported efforts to reduce carbon emissions to address global warming, but economic factors have led to reduced ambition in recent years.

France and Germany, which both have large car industries, agreed last week to lower the CO2 emissions targets for cars in 2035 to 90%, with no need for compensatory measures.

The agreement reached early Tuesday states that automakers should reduce average emissions of new vans by 80% in 2035.

For 2030, the proposed CO2 reduction targets would be 55% for cars, as the Commission proposed last year, and 35% for vans, down from the Commission's 40%.

Automakers would be able to meet the 2030 targets over the average for the years 2029 to 2031.

Cars running on renewable fuels could also be recognized as zero-emission vehicles. Small affordable electric cars and particularly efficient EVs could earn producers super-credits, helping them meet the emissions targets.

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