That's the whole point of the article. Benedict is suggesting that Vatican II went too far.
The way it was explained to me is that "no salvation outside the Church" meant that even non-Catholics could be saved just by the fact that the Church continued to exist and preach the truth. Somehow these non-Catholics would hear this truth, internally consent to it without joining the church, and would eventually end up in Heaven.
Benedict is suggesting this might not be helpful or correct. The original meaning of the saying "no salvation outside the church" meant you had to be baptized Catholic to be saved. That position was harsh, but it encouraged missionary zeal to save as many souls as possible, and it gave Catholics a good reason to be Catholic.
Interesting. I didn’t know an ecumenical council called by proper authority could err.
By the way, would you say Orthodox are saved or going to hell?
Is he? I'm not convincned that is what he is actually saying. It sounds to me that he is talking about things "after the Council". I don't see where he actually blames the Council.