I'm not sure why the article doesn't mention this anywhere, but the legislation is concerning Australia, which currently has zero fuel efficiency standards.
Because of the lack of a standard, Australia is currently a dumping ground for inefficient trash that other countries won't take, and ICE car companies don't want to lose that. Electric vehicle makers prefer the regulation because it puts them on a more equal footing.
Yes, many of these ICE companies are transitioning away from fossil fuels, but they are being dragged kicking and screaming, and any delay in legislation means they can continue to profit from these outdated cars a bit longer while they catch up on electric cars. Pretty much the same type of delay tactics that the fossil fuel industry is pushing across the board.