The European Commission is under pressure to further loosen its climate requirements for the beleaguered automotive sector faced with Chinese competition and US tariffs.

Yet, EVs are expected to represent 18 percent of new cars sold in Europe by the end of 2025, up from 13.6 percent last year, according to advocacy group Transport & Environment (T&E).

All European car manufacturers, with the exception of Mercedes-Benz, are thus in line to comply with the European Union's 2025-27 emission targets, the group said.

Carmakers "are painting a terrible picture because they want their targets weakened. But the reality is that electric car sales are surging and emissions rules are key to that equation," said Lucien Mathieu, T&E cars director.

The EU requires carmakers to progressively cut carbon emissions produced by new vehicles sold in the 27-country bloc, under the threat of steep fines.

Earlier this year, Brussels allowed firms more time to comply by averaging their emissions over three years from 2025 to 2027, rather than each individual year.

This has caused a slowdown in the EV market growth as some manufacturers reduced discounts on electric vehicles, T&E said.

"The two-year extension of the targets allowed carmakers to take the foot off the gas and will lead to two million fewer electric cars being sold between 2025 and 2027," it said.

The auto industry is pushing for a further revision of EU rules, demanding in particular more room for EV alternatives such as plug-in hybrids and highly efficient internal-combustion-engine vehicles.

To tackle climate change, the EU currently aims to phase out sales of new combustion engine vehicles by 2035.

European Commission President Ursula von der Leyen is due to hold talks with automotive industry bigwigs on September 12.