OEMs and suppliers call on EU for subsidies to support EV growth
Associations representing European OEMs and suppliers including Mercedes-Benz and Schaeffler have called on the European Commission to provide subsidies, tax reductions and lower energy costs to increase consumer demand for EVs.
A joint letter from the European Automobile Manufacturers’ Association (ACEA) and the European Association of Automotive Suppliers (CLEPA) addressed to Ursula Von der Leyen, president of the European Commission, said the incentives are needed to make the transition to EVs work, and to meet the net zero goal by 2050. The letter was co-signed by ACEA’s president and CEO of Mercedes-Benz Ola Källenius and CLEPA’s president and CEO of powertrain and chassis at Schaeffler.
It said that the EU regulates manufacturers on the supply of new low emission and electric vehicles, but fails to provide the conditions to enable a successful transition, and pointed to tariffs, the competition with Chinese OEMs and the overreliance on Chinese imports for EV batteries as challenges in electrification.
“Europe faces near-total dependency on Asia for the battery value chain, an uneven distribution of charging infrastructure, higher manufacturing costs including electricity prices, and burdening tariffs from key trade partners, such as the 15% duty on EU vehicle exports to the US,” the letter said. “We are being asked to transform with our hands tied behind our backs.
As a result, the BEV market share is around 15% for cars, 9% for vans and 3.5% for trucks, “far from where it needs to be”.
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The associations asked for “more ambitious, long-term and consistent demand-side incentives” as well we multiple drivetrain technologies to boost EV demand.
“Without policies that enhance European competitiveness to maintain manufacturing, the transition risks hollowing out our industrial base, putting innovation, quality employment and supply chain resilience at risk,” it added. “The world has changed drastically since the current direction has been set, and the EU’s strategy for the automotive sector must change with it. We must move beyond the narrow assumption that this transition hinges solely on CO2 targets for new vehicles.”
The heads of the organisations asked that the European Commission's upcoming ‘strategic dialogue’ meeting on September 12 addresses the industry’s requirements.
