Carbon Cuts

Under the deal, announced on Monday, Dec. 1, plans to limit the gas blamed for global warming would be phased in over several years, with 65 percent of cars to meet the goal of releasing 120 grams or less of the pollutant per kilometer by 2012.

But in what was seen as a compromise deal, several prominent EU auto brands were excluded from 2012 phase-in date.

Germany won a reprieve for jobs and earnings after luxury carmakers BMW and Mercedes were allowed to continue manufacturing higher-carbon output vehicles until 2014. Britain's Aston Martin and Jaguar and Italy's Fiat, Maserati and Ferrari also joined selected French automakers and the German pair in being awarded special treatment.

The EU set 2015 as the final date by which all European carmakers must fully implement the new rules.

"This deal represents a balance between the needs of the environment and the car industry across Europe, which is suffering massively at the moment," said British Conservative member Martin Callanan.

European parliamentarian Angelika Niebler of Bavaria's Christian Social Union, where BMW is based, said the deal was a genuine compromise.

"We do something against climate change but we give at the same time the industry a chance to adjust in the medium term," she said.

German Environment Minister Sigmar Gabriel called the deal a "good compromise."

Industry 'driving negotiations'

Environmentalists labeled the decision a step backwards. Greenpeace said the EU had caved in to industry demands to weaken carbon emission reduction targets and reduce penalties for non-compliance.

"Countries like Germany and Italy have wrecked the car law by defending the short-sighted interests of their national car industries," Greenpeace EU transport policy campaigner Franziska Achterberg said on the organization's Web site. "This doesn't bode well for the future of the EU's effort to tackle climate change.

"The car industry has been driving negotiations all along and EU politicians have been happy to sit in the passenger seat making comments about the scenery," she added.

Modest fines for target abuses

The EU's long-term goal is to limit emissions by 40 percent to 95 grams per kilometer by 2020. Though environmentalists said any language to make this target binding had been removed from the text "at the last minute."

Under the deal, carmakers would be fined 95 euros ($120) per gram and per car sold that does not meet the emissions target but a long way. Smaller abuses of the targets would attract more modest fines.

The agreement must still be approved by the European Parliament and the 27 member states before going into effect.

Environment ministers from the member states are to discuss the plan at their meeting Thursday and Friday.