ACEA expects a difficult year for the European car industryMarch 1, 2019
The automotive industry in Europe this year will face a number of fundamental problems. According to Erik Jonnert, Secretary General of ACEA (European Automobile Manufacturers Association), the current challenges facing the EU auto industry consist primarily of: the upcoming Brexit perspective, the US tariff threat on car imports from the EU, and the adoption of strict emission standards CO2.
Despite the fact that the year 2018 was the fifth year in a row, when nearly 15.2 million cars were registered, the market growth rate dropped significantly. Annual growth was only 0.1%.
For example, in 2015, sales growth was 9.3%, and in 2017 already 3.4%.
According to preliminary ACEA forecasts, in 2019 car sales in the EU will remain at the same level as last year, with a possible increase of less than 1 percent.
A little more than a month remains before Brexit, notes Eric Jonnert, but, unfortunately, the prospect of disrupting the expected scenario cannot be ruled out.
“On the contrary, the closer we come to B-Day, the more likely it is that Brexit agreements will not work.” This causes enormous uncertainty for the European economy, and also affects consumer sentiment, ”the Secretary General of ACEA emphasizes.
Uncertainty with the UK is forcing European automakers to reinsure. Some are looking for warehouse space to increase parts inventory, others are planning a temporary cessation of production after Brexit, and some automakers are even reducing their investments in the United Kingdom. According to the association of the British automotive industry SMMT, investment in the automotive industry in the UK in 2018 fell by 50%.
The threat of the introduction of American tariffs on the import of cars and auto parts from Europe is becoming more and more real, stress the opinion of ASEA, and its head insists European carmakers do not pose a threat to US national security.
“In fact, our manufacturers not only supply finished cars to the United States, but also created a large production base there, where hundreds or thousands of Americans work directly or indirectly. They also export 60% of the cars produced there from the USA, ”says Mr. Yonnert.
In his opinion, the introduction of tariffs will have a counterproductive effect on the US economy, since Last week, the European Commission clearly indicated that it intends to take retaliatory measures against the introduction of any measures. The possibility of exacerbating this situation is extremely worried about business on both sides of the Atlantic.
In such a difficult trading climate, the additional burden on the European automotive industry is created by the recently agreed CO2 emissions targets for 2025 and 2030. for new cars and minibuses.
This situation will require a greater presence in the market of electric cars and other “green” vehicles than it is now.
If Europe is serious about implementing these very ambitious CO2 reductions in practice, politicians must ensure that the right incentives are created, emphasize in ASEA, above all with sufficient investment in charging and fueling infrastructure. It is noted that targets for CO2 emissions and switching to the electric cars they need will also have an impact on jobs in the entire value chain of cars, which today employs about 13.3 million Europeans. In addition, the development of electrification of transport will also affect its availability and cost. It is assumed that in the future, batteries will amount to 35-50% of the cost of an electric vehicle. At the same time, it remains unclear whether these batteries will be produced in the EU or imported, representatives of the European automotive industry are wondering.
“Our industry will make efforts to adapt to these changes,” says Eric Jonnert, “But to limit the negative impact of these structural changes, politicians need to act quickly. We need concrete plans to cope with employment issues and the development of competencies in a correct and socially acceptable way. ”
“European automakers are striving to solve the challenges we face. They invest and innovate to promote mobility. However, this equally requires continued support from politicians, since they must provide the conditions under which in the future mobility will remain available to all Europeans, regardless of their financial capabilities or place of residence, ”concluded the Secretary General of ASEA.
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