BERLIN (Reuters) -BMW Chief Executive Oliver Zipse said the European Union's planned phase-out of combustion engines by 2035 was a "big mistake", calling for a shift to emission measures that capture a vehicle's entire supply chain.

Zipse said in an interview with Politico, published on Friday, that setting a fixed date for the transition risked ignoring emissions across the value chain, including battery production and fuel sourcing.

He urged EU regulators to allow climate-friendly fuels beyond 2035, saying fuel producers must also be held accountable.

"We do ourselves no favours by setting arbitrary future dates by which all industries must adapt," he said in the interview, extracts from which were published on Friday morning. "The absurdity of the current rules is that the fuel makers - the Shells and the BPs - face no targets."

Despite problems facing the industry such as higher tariffs, weak demand and Chinese competition, Zipse said BMW remains on track to sell more than 2.5 million vehicles in 2025. "We are ahead of last year's numbers as of August," he said, noting growth particularly in Europe.

He was speaking ahead of the IAA motor show in Munich, Europe's biggest, at which the Bavarian-based company will launch the first model of a new class of electric vehicles.

(Reporting by Thomas Escritt; Editing by Emelia Sithole-Matarise)