Ford Motor Co. criticized the EU's decision to delay a vote on imposing stricter CO2 emissions for all new cars in the European Union starting in 2020.
Representatives of EU countries on Thursday postponed a decision on limiting to average fleet CO2 emissions to 95 grams per kilometer after a late intervention from Germany.
Berlin is worried that the target will harm the country's luxury carmakers such as BMW and Mercedes-Benz, which mainly sell large vehicles with high emissions.
Ford Motor said it was disappointed that a minority of member states was able to delay a "well-balanced" agreement.
"As a company committed to meaningful CO2 emission reductions through advanced technology, Ford is disappointed. We will now have to regroup within the industry to determine the next steps," Ford said.
German Chancellor Angela Merkel said that she blocked the deal because of concerns the measure would cost jobs in the auto industry. "This is also about employment," Merkel told reporters in Brussels on Friday after a European Union summit.
"At a time when we're spending days sitting here talking about employment, we have to take care that, notwithstanding the need to make progress on environmental protection, we don't weaken our own industrial base," Merkel said.
A spokeswoman for Ireland, which holds the rotating EU presidency, said several delegations had asked for more time to study the agreement. The UK and the Netherlands also supported a postponement.
German automakers complain that tougher CO2 limits favor French automakers Renault, PSA/Peugeot-Citroen and Italy's Fiat that mainly sell smaller cars with low emissions.
Germany has been lobbying for weeks to shelter its premium car sector from the tighter regulations by campaigning for loopholes, known as supercredits. These allow manufacturers to carry on producing vehicles with high emissions provided they also make some very low emissions vehicles.
"With such an important policy decision, it's important that prudence trumps speed," German auto-industry lobby VDA said in a statement. "Therefore, it's correct that sufficient time to review compromise suggestions are allowed."
On Monday, Ireland brokered a compromise deal that allowed automakers to continue to offset sales of electric and other green vehicles against those of cars with high emissions, but the agreement achieved less than Germany had hoped for.
The deal needed qualified-majority support from national governments. That failed to materialize at a two-day meeting of EU leaders billed as a jobs summit that ended on Friday. It now falls to Lithuania, which takes over the bloc's rotating presidency from Ireland on July 1, to propose a new date for a decision on the matter.
Campaigners have voiced outrage at Germany's tactics, saying consumers risk missing out on the savings linked to lower-emission, more fuel efficient cars, as well as being bad for climate policy.
Monique Goyens, director general of the European Consumer Organization (BEUC) said it was "a clear case of the concerns of a handful of companies taking precedence over consumers' interests."
The 95g/km CO2 limit is equivalent to gasoline use of 4 liters per 100km, 59 U.S. mpg or 71 UK mpg. Supporters say the target would encourage innovation as well as reduce CO2 emissions that are said to contribute to climate change.