The continuous rise in demand for road transportation has a significant effect on Europe's oil dependency and emissions of greenhouse gases. Alternative fuels and vehicle technology can mitigate these effects. This study analyses power‐train deployment scenarios for passenger cars and light commercial vehicles in EU‐27 until 2050. It considers European policy developments on vehicle CO2 emissions, bio‐energy mandates and reductions in the CO2 footprint of the European energy mix and translates these into comprehensive scenarios for the road transport sector. It quantifies and assesses the potential impact of these scenarios on well‐to‐wheel (WtW) CO2 emission reductions primary energy demand evolution, and cost aspects for the prospective vehicle owners. The study reveals that, under the deployed scenarios, the use of bio‐fuel blends, technological learning and the deployment of hybrids, battery electric, plug‐in hybrid and fuel cell vehicles can decrease WtW CO2 emissions in EU‐27 passenger road transport by 35–57% (compared to 2010 levels) and primary energy demand by 29–51Mtoe as they would benefit from a future assumed decarbonised electricity and hydrogen mix in Europe. Learning effects can lead to acceptable payback periods for vehicle owners of electric drive vehicles.