Volkswagen, Stellantis and Renault have joined forces with the European Union over the rapid entry of Chinese carmakers and the pressure on European industry. The three companies are not preparing a joint car, but are urging Brussels to change the way it supports local production and sets future emissions requirements.
Their common signal was made again during the Paris Motor Show. Volkswagen, Stellantis and Renault produce more than 60% of cars in Europe and depend mainly on sales of high-volume models, not high-margin luxury cars. “We represent more than 60% of car production in Europe. We need to secure Europe's industrial base and we need to do it now. We sell a large number of cars with relatively low margins. "This business model is under enormous pressure in Europe," said Volkswagen CEO Oliver Blume. In June, the three groups issued a joint statement in support of the "Made in Europe" principle. They are urging the European Union to encourage production on the continent through realistic requirements and rules that take into account the cost differences between European and foreign manufacturers.
Volkswagen, Stellantis and Renault want to include not only physical components but also engineering, research and development work in determining the European origin of a car. They say this would take into account work done by employees and companies in Europe, even when part of the assembly or delivery is outside the continent. The demand comes as Chinese manufacturers are pushing to start or expand production and assembly of cars in Europe. European companies fear that if the rules only take into account physical parts and final production, Chinese brands will be able to benefit from European incentives without creating the same amount of local added value. European rules require average emissions from new cars to be reduced by 55% by 2030 compared to 2021. A full reduction in average emissions is set for 2035, although the European Commission is already considering a 90% target.
Manufacturers are pushing for more flexibility in meeting the targets, as demand for cars with internal combustion engines remains significant. If companies fail to reduce the average emissions of their fleets, they may be forced to limit sales of such models. This would affect production volumes and plant capacity.
Renault CEO Francois Provost warned that without more flexible rules for 2030, the company could reduce its production in Europe by up to 300,000 cars. Such a move could put jobs and production capacity under pressure. At the political level, Germany and France are also pushing for changes to the European approach to the automotive industry. The pressure is expected to intensify with the preparation of the Industry Acceleration Act and the upcoming decisions on the implementation of emissions targets in 2030 and 2035.