The European Commission’s plans to force carmakers to produce more efficient cars have received approval from the EU Council of Ministers.
It means plans for an average emissions level of 120g/km of CO2 target will be formally proposed by the commission by Christmas and will come into force by 2012.
In a communiqué, ministers gave “support to the EU objective of 120g CO2/km on average for new cars sold in the EU by 2012”.
The news follows confirmation that Germany, which opposed the move has reached an agreement with France, which supported it.
French carmakers generally make smaller cars while the Germans are known for producing higher polluting executive and sports cars.
The agreement between the two countries means there will be a "substantial" phasing-in period.
"There will be a so-called phasing in for fleets. Fleets of cars will be viewed in their entirety.
"The details of that will be worked out by the environment ministers,” said German chancellor Angela Merkel.