Auto giants Volkswagen and Stellantis urge EU to shield auto industry

Two of Europe’s largest carmakers, Volkswagen AG and Stellantis NV, have asked the European Union to take stronger measures to support the region’s struggling automotive sector. The companies say the industry is facing increasing pressure from geopolitical tensions and stiff competition from Chinese manufacturers.

According to a report published by Bloomberg, the chief executives of Stellantis and Volkswagen said the EU should introduce carbon dioxide bonuses for vehicles manufactured in Europe. They said that the move would help protect jobs and support local manufacturers in meeting climate targets.

Warning over geopolitical rivalries

“Europe is witnessing the emergence of new geopolitical rivalries," wrote Stellantis CEO Antonio Filosa and Volkswagen CEO Oliver Blume. “Trade, technology, and industrial capabilities are being mobilised more than ever to serve national interests. The European Union must choose its path quickly," they said.

Debate over ‘EU preference’ rules

France is among the countries pushing for a so-called “EU preference" for electric vehicles as Brussels prepares new proposals for the auto industry. The European Commission was expected to decide on possible “Made in Europe" rules in January, but divisions within the bloc have delayed the decision by at least a month.

Stellantis criticises EU electrification changes

Stellantis, the parent company of Fiat and Peugeot, is among the manufacturers that have criticised changes proposed by the European Commission. These had been aimed at easing the financial burden of the shift to electric mobility. The company has suggested that the transition to electrification continues to place significant cost pressure on carmakers.

Battery production highlights EU dilemma

Blume and Filosa said the difficulties faced by companies trying to manufacture EV battery cells in Europe clearly illustrate the EU’s dilemma.

“We are investing heavily to build an integrated European sector, essential for our technological sovereignty, but consumers legitimately expect affordable electric vehicles," the two executives wrote. “However, the more prices need to be kept down, the greater the need to import the cheapest batteries."

Review of battery ventures underway

Filosa is currently reviewing Stellantis’s global operations and is considering resizing or ending some battery joint ventures. The review comes at a time when demand for battery-powered vehicles has softened.

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