“It's already clear that the EU will not reach these overambitious objectives for its car industry, and no comparable goal has been set anywhere else in the world,” VDA president Bernhard Mattes said in a statement.
A pillar of the German economy, the car industry employs around 800,000 people directly.
“The European car industry will be more heavily burdened in international competition than its challengers…this is gambling with jobs and weakening Europe as a production site,” Mattes added.
European ministers reached a hard-fought deal Tuesday to reduce CO2 emitted from new cars by 35 percent by 2030.
That was already a compromise, as Germany and some eastern EU nations resisted a push from the likes of France and the Netherlands for bigger reductions.
Responding to the carmakers' criticisms, Chancellor Angela Merkel called the target “justifiable”.
“If there had been no agreement, things would have been unpredictable for the European car industry” with European Parliament elections approaching in May, she added.
A former environment minister in the 1990s, Merkel was a key player in the 2015 Paris accords.
Under the global deal, the EU is committed to a 2030 goal of slashing output of greenhouse gases like carbon dioxide (CO2), methane or nitrous oxide by 40 percent compared with 1990.
Climate change-fighting moves are in stronger focus this week, after UN experts warned drastic measures are needed to avoid global temperatures rising more than the average two degrees Centigrade targeted in Paris.
Meanwhile the German car industry continues to suffer from the reputational damage of the “dieselgate” scandal, which revealed millions of vehicles worldwide were manipulated to appear less polluting.
In July, the European Commission uncovered a new trick by car companies, accusing them of inflating CO2 emissions figures in current models to make it easier to hit future targets for reducing output of the gas.