EU Green Deal too important to fail environment and industry

The envisaged early review of the CO2-emission targets for cars and trucks for 2030 confronts the European Commission with an uncomfortable dilemma. The review offers a compelling opportunity to increase the efficiency of the available regulatory levers, allowing manufacturing competitiveness and employment to be preserved while delivering on ambition.

in CLEPA, by Sigrid de Vries, 17-03-2021


However, the timeframe of the forward-hauled review is so tight—it is set to be accomplished by June this year—that any serious rethinking of the available instruments is deemed ‘too cumbersome and too complex, while inviting the risk of unwelcome delays.’ Or so it echoes in Commission corners.

Are these concerns credible?

The EU Green Deal, coined as a green growth strategy, is too important to fail. There is too much at stake for the environment, workers, citizens and industry alike. It would be equally ‘unwelcome’ to risk massive collateral damage as a result of EU policy that is rightly aiming for bold and ambitious reforms.

As laid out in detail in the new CLEPA position paper on climate neutral transport, the Commission should seriously consider solutions that can make a difference and that actually already exist, within the current framework of policies and legislations. This is neither complex nor cumbersome, and it does not need to cause delay.

Simply upping the target levels without accompanying measures to making them viably implementable will not do the trick for the environment and cannot be considered as responsible policy making either. Such an approach risks doing an irreparable damage to the economic fabric that is fundamental for Europe’s capability to innovate and meet its goals.

What do the available policy levers consist of?

First, there is a need for the large-scale delivery of electric charging infrastructure to enable the current plans for vehicle technology targets to be achievable. At present, the number of public charging stations stand at 220 thousand, disproportionately spread across the EU. Significantly more stations will be needed to achieve the existing 37.5% reduction target for cars, and every additional percentage point will require correspondingly more charging stations and power infrastructure to serve them. The pending revision of the alternative fuels infrastructure directive should be used to mandate member states to make the necessary investments.

Second, technology should be allowed to deliver on climate neutrality, rather than regulation prescribing or banning technology. The full range of efficient technologies, renewable energy and climate-neutral fuels will be needed, so that the right technology can be chosen depending on the use case: highly-efficient piston engines powered by hydrogen or sustainable renewable fuel, electric vehicles (battery electric and fuel cell electric), hybrids and plug-in hybrids.

Importantly, technology openness will offer a choice to those consumers and businesses for which electrification is not a practical or cost-effective option, enabling them to take older, higher-emitting vehicles off the road. The definition in green procurement standards of zero and low emission vehicles should therefore include all technologies enabling zero and low emission driving. Plug-in hybrids with an electric range of 80 km should be treated the same as battery and fuel cell electric vehicles. Suppliers support the implementation of on-board fuel consumption meters to reflect as much as possible real driving emissions. Technology can also help secure electric-mode driving.

Policy should activate a link between CO2-targets for vehicles and incentives to invest in defossilised fuels

Third, policy should activate a link between CO2-targets for vehicles and incentives to invest in defossilised fuels to deliver on the objective of climate-neutral transport and mobility. Complementing electromobility, it is realistic to expect vehicles with an internal combustion engine on the roads up to 2050 and beyond.

With the use of renewable and low carbon fuels, CO2 emissions would decline from the get-go. Defossilising fuels has an immediate effect on emissions from all cars and trucks on the roads, not only new vehicles. Renewable fuels can be deployed in the existing fuel infrastructure, and can be produced efficiently.

Clean combustion is a viable option, also regarding air quality, as recent data from the UBA, the German Energy Agency, has demonstrated. The regulatory framework should recognise and foster the reduction potential of renewable fuels in transport. This doesn’t need a major overhaul; the instruments are there, such as the existing sustainability certification scheme for transport fuels in the Renewable Energy Directive.

A system, for example, of providing CO2 credits in exchange for the use of renewable fuels can deliver substantial CO2 savings cumulatively by 2030, as calculated by Frontier Economics, 2020 for the German ministry of economy. Such crediting scheme can provide a pull to market-driven carbon-neutrality, facilitating the efficient use of different technologies. The scale in road transport would also help to pave the way for the use of renewable fuels in hard-to-electrify sectors such as shipping and aviation.

The direction of travel and the speed of the journey are crystal clear and automotive suppliers are heavily invested in the change

To be clear, this is not an argument against electrification of the drivetrain, nor do automotive suppliers argue to slow anything down. The direction of travel and the speed of the journey are crystal clear and fully supported. The industry is heavily invested in the change, as illustrated this week once more by the CLEPA Pulse Check survey of its members.

Ours is an argument in favour of a pragmatic approach, a ‘win-win’ for climate and jobs, one that harnesses EU industrial capacity and creates a level playing field for technology options to compete in the marketplace in the EU, but also globally.

There are significant opportunities for the mobility industry to remain a key contributor to well-paid employment, and to help secure the EU’s role in a global green and digitalised economy. But there are also significant risks involved. Especially when forced disruption takes precedence over rapid yet efficient transformation. The jobs at risk are, in many cases, not easily interchangeable with newly created jobs elsewhere in the mobility value chain. Many livelihoods will be impacted dramatically.

Industry and society need to be given the chance to manage an ambitious transition. The current regulatory framework has the instruments in place to help deliver short-term. They need to be seriously considered and mobilised.

Sigrid de Vries

CLEPA Secretary General

Automotive supply industry confidence picks up considerably, CLEPA Pulse Check shows

  • Profitability expected to stabilise on back of growing order intake
  • Sentiment positive despite hindrances in supply of semiconductors and other critical materials
  • Nine out of ten suppliers are reviewing and adapting product portfolio

in CLEPA, 15-03-2021


Automotive suppliers have become significantly more optimistic with their outlook on 2021, with 38% of surveyed suppliers showing positive forecasts compared to just 8% six months ago. Yet, 31% of respondents still hold a notably negative view, a much higher share than in pre-Corona times. This follows from the latest CLEPA Pulse Check survey on business sentiment in the sector, held late February into early March.

The majority outlook is robust in response to the much faster than expected rebound of the global automotive market, with four out of five suppliers expecting to increase order volumes in the next 12 months. Profitability is foreseen to stabilise further, with numbers above 5% in reach for over four out of ten respondents again.

“Sentiment is improving despite the continued concern on the impact of the pandemic and the current difficulties with deliveries of semiconductors and other critical materials, like steel and plastics, and constraints in transport and logistics capacity, all of which do have a dampening effect”, said Sigrid de Vries, CLEPA Secretary General. Over 60% of respondents in fact indicate to be impacted by these difficulties, resulting in delayed or interrupted production.

Respondents acknowledged that the semiconductor crisis has unveiled flaws in the just-in-time supply chain management. This has been compounded by low upfront chip commitment, and competing with strong demand in consumer electronics and a saturated capacity with base-chip manufacturers. Short-term recovery is not expected before at least another 3 months, and concerns are raised about the traditionally strong consumer demand  in the third and fourth quarters ahead of Christmas shopping. De Vries: “Suppliers and OEMs must work to increase their visibility on demand along the whole chain and leverage the rapidly growing automotive demand toward other sectors.”

Situation on the ground 

A closer look at the overall sentiment reveals a considerable number of both bullish and more bear-sighted respondents, with the share of neutral views fading. De Vries: “The situation on the ground differs depending on exposure to global markets, impact of the COVID-19 crisis, level of advancement towards new opportunities in connected and automated driving and alternative powertrain solutions including electric motors, axles and battery management systems, and the need to manage change in a shrinking market.” The rebound in order volumes is mainly seen in China and the US, with Europe lagging behind. 

The pandemic is accelerating the structural transformation of the sector on the road to digital and carbon-neutral mobility, which had already started before 2020. “During the crisis, many companies have drastically cut costs and these measures are now paying off. With expectations on the pace of the economic recovery in 2021 until only recently having been much more modest, companies now see their order books filling up fast, allowing for an uptake in investment spending and planning.”  

Dramatic change 

Market watchers agree that the need for further structural measures has not gone away. “The race to stay competitive is on, and there will be winners and losers as a result. This is indeed visible in the CLEPA Pulse Check. Only 4% of respondent do not foresee dramatic change in their businesses in the next 5 years. This number has not yet been so low”, added De Vries. 

Change is expected to culminate in further consolidation of the sector (70% of respondents rank this number one). 68% refer to an expected shift in profit pools from traditional components to software. Half of respondents point at the increasing importance of activities involving key high-tech components.  

So-called sunset components are believed to become even more commoditised with lower margins resulting consequently. For those active in combustion engine related technology, the increasing demand for electrified solutions puts significant pressure on their business model. With global automotive volumes not foreseen to reach beyond 100 million units again any time soon, the overall pie is also shrinking.   

Portfolio shift 

For many, the challenge is to maintain revenues while making substantial investment in alternative solutions, without an immediate return in sight. The demand for electrified vehicle is increasing but the overall share in sales is still modest, reaching 11% of market share in Europe in 2020. The same applies to smart mobility and connected services. The fight for a part of the future share is, however, taking place right now. 

Nine out of ten suppliers are currently reviewing and adapting their product portfolios. The Pulse Check reflects the various strategies they currently deploy to manage change. Foremost, 61% of respondents ranked in-house development of new technologies a priority, secondly, 51% opt for change of strategic focus within the existing portfolio, with consolidation and mergers and acquisitions ranking almost equally third (32%) and fourth (29%). Interestingly, half of suppliers also actively explore markets for their technology solutions outside of the automotive realm, notably in household appliances and charging solutions. 

CLEPA performs the Pulse Check survey twice a year, surveying CLEPA members with the support of McKinsey who aggregate the data. 

 

European Battery Alliance: Automotive jobs at risk need policy to accelerate change and avoid unnecessary disruption

On 12 March, the Commission held a high-level meeting under the European Battery Alliance. Vice-President Maroš Šef?ovi?, Commissioners Thierry Breton, Nicolas Schmit and Elisa Ferreira, as well as the European Investment Bank Vice-Presidents Ambroise Fayolle and Thomas Östros took part in the event alongside Ministers from 14 EU Member States with significant investments in the battery value chain.  

in CLEPA, 15-03-2021


As reported by POLITICO, Germany’s Economy Minister Peter Altmaierone key part in this alliancetold the publication that their “goal is to achieve a world market share of 30 percent”. Currently, Europe has less than 5 percent global market share. 

Vice-President Maroš Šef?ovi? indicated, in fact that the goal is to become the second largest battery cell producer: The production of lithium-ion cell batteries has shown the most progress – and by 2025, we are now set to become the second largest battery cell producer in the world, behind China. Moreover, nearly 30 announced projects should largely satisfy the EU demand for batteries driven by e-mobility.” 

In terms of regulation, the European Commission announced that it expects an adoption of the proposal by 2022 at the latest.  

Concerns of impact on employment remain  

The Alliance is supporting 70 industrial projects and as declared by Vice-President Maroš Šef?ovi?, it is expected “to create 3 to 4 million jobs by 2025”  

Vice-President Maroš Šef?ovi? declared: “The industry estimates that by 2025, this growing skills shortage could amount to some 800,000 jobs across the entire battery value chain.” 

This is a considerable number that calls for an automotivespecific plan to prepare its workforce for the impact of this transformation. 

“There are significant opportunities for the automotive supplier industry to remain a key contributor to well-paid employment and to help secure a green and digital economy. This will require a joint effort to reskill people, secure jobs and enable investment in innovative technology solutions. It also requires the willingness to examine the real impact on the ground. Jobs at risk are in many cases not easily interchangeable with new jobs elsewhere in the mobility value chain. Policy to manage the transition must therefore aim to accelerate change as well as avoid unnecessary disruption.”, says CLEPA Secretary General Sigrid de Vries. 

 

European steel users call on Commission to terminate safeguard measures on 30 June 2021

In response to today’s announcement by the European Commission that it will review the safeguard measures on steel, in place since 2018, a coalition of downstream users of steel is urging the Commission not to extend the measures beyond their expiry date this June.

in CLEPA, 26-02-2021


While the COVID-19 pandemic has severely impacted manufacturing activity across all sectors in Europe during 2020, production levels are now increasing and are expected to continue to do so as the economy recovers during 2021.

As a consequence, and since the second half of 2020, companies are facing surging prices for steel products and long delivery times because of an insufficient domestic supply. Due to the safeguard measures currently in place, reduced competition from third countries means that import alternatives aimed at easing cost and lead-time pressures on European manufacturers have been limited.

The possibility of extending the safeguard measures beyond June 2021 adds to the uncertainty and adverse market conditions that steel users are currently facing.

It is in the interest of downstream users to rely on a strong and competitive EU domestic steel industry. Excessive protection will only result in an uncompetitive European steel industry, to the detriment of downstream users and final consumers. Therefore, the steel safeguard measures should expire on 30 June 2021 as foreseen.

 

The coalition of EU trade associations representing the interests of downstream users of steel consists of ACEA, APPLiA, CECE, CEMA, CEMEP, CLEPA, Orgalim, and WindEurope.

 

2021.02.10 Joint PR-Review of Steel Safeguard Measures_vF

 

 

CLEPA welcomes the European Commission’s new trade strategy and is ready to continue to engage

CLEPA recognises that today’s communication confirms the EU’s growing attention for sustainability and level playing field. CLEPA will continue to play a constructive role ensuring that trade policy initiatives that aim to address legitimate concerns regarding level playing field, supply chains, human rights and sustainability are shaped effectively and do not result in counterproductive outcomes. It will be crucial to ensure that trade policy instruments do not circumvent or undermine the WTO. Instruments that could be perceived as protectionist should be carefully considered and trade partners should be consulted to avoid trade tensions and a spiral of retaliation measures. Trade in innovative and sustainable technologies will play a key role realising the objective of a sustainable and circular economy, highlighting the importance of a trade strategy that facilitates a global flow of goods and access to markets.

in CLEPA, 18-02-2021


CLEPA Secretary General Sigrid de Vries said: “CLEPA welcomes the European Commission’s new trade strategy and the clarity the communication provides on the core objectives of the EU’s trade policy. Europe’s automotive suppliers agree that an open trade regime is at the centre of Europe’s economic prosperity and competitiveness. Continued access to global markets and a stable, global trade environment will be crucial for our sector to recover from the current crisis and continue to invest to maintain our leading role as innovators in sustainable and safe mobility.   

The openness of the Single Market and Free Trade Agreements create opportunities for businesses across the world and help attract investments, creating jobs and strengthening Europe’s economic fabric. CLEPA will continue to support the Commission in its efforts to negotiate trade agreements with third countries and endorses ratification of concluded agreements, including the FTA with Mercosur. The Commission rightly pursues reform of the World Trade Organisation, as it will play a crucial role providing a secure and stable framework for international trade and investment.  This is particularly true for automotive suppliers who rely on an open and stable trade environment to fulfill a leading role in the global supply chain. The scale of the global market allows our industry to provide 1.7 million direct jobs in the EU alone and invest €30 billion a year in innovation.

 

 

CLEPA | Sheer dimension of chip shortages requires rethinking by industry and policy makers

The sheer dimension of the semiconductor shortage and the complexity of solving both short and long term issues requires rethinking of supply chain options by both industry and policy makers. It also signals how 2021 may well become a year of great volatility for manufacturing industries.

in CLEPA, by Sigrid de Vries, 17-02-2021


Many elements are coming together in the current semiconductor shortage in the automotive industry: from the fall-out of the COVID-19 crisis and the unpredictability of crisis recovery, to increased automotive demand for chips due to assisted-driving functions and electrification, to geopolitical and natural disaster ‘de-risking’, to competing demand from other sectors.

In the first wave of the pandemic, the automotive industry came to an almost complete standstill and had to dramatically adjust production volumes to fence off costs, with little to go on as regards timing and speed of the recovery. When demand then picked up rapidly, many were still wary on how solid the trend would be. The automotive supply chain for advanced chips is typically long and this added complexity: many actors need to align and sync their demand and supply.

Marked volatility may also hit sourcing of other key materials

In January 2021, the sector saw itself confronted with a large gap between ordered and produced vehicles, coupled with a higher demand for 2021 than scenarios foresaw and much lower stocks than usual. In addition, demand for electric vehicles started soaring driven by acceleration of the green transition, increasing pressure on semiconductor demand.

Industry and market watchers expect the disruptions to last well into the second half of the year, with great variety in who will be hit and for how long. Industry sources also warn that similar patterns may occur throughout 2021 in the sourcing of other materials needed to build cars as well as industrial goods and consumer products. A continued, marked volatility in demand, driven by uncertainty around the containment of the pandemic, regional variations, and difficulty to predict purchasing behaviour, may cause disturbance in the supply of essential resources. Logistics may be vulnerable too, with demand soaring in China taking away capacity from elsewhere.

The unmistakable trend, however, is that automotive demand for semiconductors will continue to grow big time due to the increasing share of automated and assisted driving technologies to keep drivers comfortable and safe, as well as the electrification of vehicles with the required sophisticated management of battery performance and other electronics.

Automotive demand for semiconductors will continue to grow big time

On average, a vehicle today already contains around a hundred advanced semiconductors chips, a steep increase compared to only a decade ago, but the value of semiconductor content of electrified vehicles can be up to three times higher. Expert estimations hold that electronics and semiconductor materials could represent up to 45% of the value of a car by 2030.

Automotive supplies are already heavily invested in vehicle electronics, covering the wide range of applications from on-board comfort and infotainment systems to active-safety features to battery and wider powertrain management. With activity and employment rapidly diminishing in combustion engine based technology, the expansion into ‘digital’ offers substantial opportunities.

Whereas the European semiconductor ecosystem currently provides employment for 200,000 people, McKinsey estimated in 2019 that under the right conditions, the automotive industry alone could create 400,000 European jobs related to electronic and software components for vehicles. Currently, 1.7 million people are employed by the automotive suppliers in Europe, on top of the 1.2 by vehicle manufacturers.

However, the investments needed amount to billions of euros and the return in both revenue and employment levels is years off in comparison to the impact of the restructuring costs and R&D efforts made in the here and now. In this light, the semiconductor events not just underline the attention required for the diversification and resilience of the supply chain. They also raise strategic questions for Europe.

Questions that the European Commission will try to partly address through a Microelectronics Alliance for Europe, to be launched next month, in analogy to the earlier established European Battery Alliance. The German and French governments are also looking to increasing industrial activity in this field, as voiced in a joint statement this week, notable through the IPCEI instrument (Important Project of Common European Interest), and argue that the European Recovery and Resilience Funds should be used for this.

Focus should be on R&I and market demand, rather than on subsidies and reshoring

The European Commission will look at both manufacturing options as well as strategic R&I, and this is the right approach. Both aspects need careful consideration. Successful industries do not result from subsidies and government intervention towards reshoring, but follow market demand and concrete business cases. The focus on R&I will be critical, as will the availability and strengthening of digital skills and competence throughout education and employment in Europe.

The key challenge will be to secure advanced semiconductor development and production in Europe, sharing base technology between players while allowing enough space for diversification, on a scale to profitably supply a home market as well as players abroad. The Commission has rightly identified automotive as one of four sectors to focus on. Automotive globally is responsible for around 10% of semiconductor demand, yet in Europe for 37%: there will be no successful European semiconductor strategy in which automotive won’t play a key role.

European semiconductor strategy cannot be successful without a key role for automotive

The future semiconductor strategy is connected to the wider question of how to ensure that EU industry as a whole captures business and employment opportunities in electronics, software and artificial intelligence and secure its future relevance. In this light, also the upcoming Digital Decade Strategy of the Commission and the review of the EU Industrial policy will need careful calibration. The many strategies and initiatives must be coherent and mutually reinforcing.

A successful industrial strategy will have to rely on the long game of supporting R&I investment, standard setting and improving Europe’s role in artificial intelligence research, skills as well as its attractiveness for international talent. The automotive sector has the potential to serve as an essential bridgehead for the wider European industrial base to capture opportunities of an increasingly digital economy.

Sigrid de Vries

CLEPA Secretary General

 

Automotive suppliers raise red flag over border closures and intensified inspections

The implementation of border controls between the German and the Czech and Austrian border crossings risk to create disturbances in automotive industry production plants soon.

in CLEPA, 15-02-2021


Sigrid de Vries, CLEPA Secretary General highlights: “Europe’s automotive suppliers are concerned about recent announcements on border closures and intensified inspections. These measures result in disruption at Europe’s internal borders and critical delays in the supply chain. The Single Market is an important achievement of the European Union. Defending its integrity is a priority, specifically with regards to the freedom of movement of goods and workers. Parts stuck at the border could disrupt our Just in Time supply chains, interrupt production and put the sector’s performance and jobs at risk”.

in CLEPA, 15-02-2021


While health and safety are paramount, and industry itself has taken numerous measures to keep up highest standards, it is also important to safeguard the integrity of the internal market. “EU governments must respect their commitment agreed during the January Council to keep borders open”, says de Vries.

“Transport of goods should be exempt from border closures and Member States should ensure the alignment of their border control measures to support the functioning of the Single Market. If controls at the border crossings are intensified, Member States should respect their commitment to prioritise freight transport, as done successfully during the first wave through the introduction of ‘Green Lanes‘ with easily applicable rules. It is important to note that COVID-test requirements for professional truck drivers could undermine corridors for goods and risk disrupting supply chains, as shown by the example of Dover in December, where long queues to test truck drivers resulted in significant disruption, while almost all truck drivers tested negative for the virus. Only by setting up a practical test practice that can ensure the protection of the workers while guaranteeing the supply of goods would keep the automotive supply chain working”.

 

 

CLEPA – Optimism and caution prevail, entering into 2021

The automotive and mobility technology suppliers have started the year 2021 with mixed feelings of optimism and caution. Optimism, because demand for vehicles and components is picking up more rapidly than expected and the appetite for new, innovative technologies is accelerating. Caution, because the scars from 2020 are deep and the level of uncertainty remains high.

in CLEPA, by Thorsten Muschal, 21-01-2021


What are the threats and opportunities for the automotive and mobility technology sector in 2021? We’ve listed five themes that will play a key role in shaping the recovery:

Click here for the full CLEPA outlook on the recovery in 2021

Thorsten Muschal, member of the management of Faurecia and CLEPA President comments on the supply industry’s outlook on the new year: “COVID-19 has hit the automotive supply industry particularly hard and the impact of the crisis will remain a major factor in the new year. Many in the supply industry, in the last months of 2020, have managed to recover a good portion of the earlier revenue losses, allowing for optimism as regards further recovery in 2021. However, uncertainty remains high given the volatility associated with the containment of the COVID-19 pandemic.

Until large parts of the population have been vaccinated, the threat keeps looming of supply chain disruptions, factory lockdowns and border closures which caused much damage during the first wave of the pandemic. As a consequence, the planning of production remains much more challenging than it usually already is in the just-in-time operations of the sector.

Planning of production remains much more challenging than usual, as illustrated by the semi-conductor shortage

An illustration of this is provided by the current shortage of semi-conductors in the automotive sector. A combination of different factors – the COVID pandemic, the trade war between China and the US, a spike in demand from the consumer electronics side and the acceleration of vehicle electrification – has added weeks of delay to already long supply chains.

This has fortified questions on the need for ‘strategic autonomy’ of the EU and localisation of supply which need to be carefully assessed in the context of global playing fields and competitiveness. The global trade environment will in any case continue being an important factor for stability.

In 2021, the risk of further employment loss remains high. Last year, over 50 thousand job cuts were announced by Tier1 suppliers alone, according to Eurofound data, matching a similar number with vehicle manufacturers. The situation among small and mid-sized enterprises is more difficult to account for but, as a rule of thumb, one job with Tier1 suppliers generally supports another two to three livelihoods down the supply chain. Smaller companies also tend to have more trouble keeping up liquidity to sustain their business.

Substantial R&I investments are crucial for the development of affordable mobility

A further major concern is presented by the cuts that many suppliers had to make in their R&D budgets in order to cope with the crisis. R&I is the main factor in ensuring that automotive products are continually improved in terms of environmental impact and social sustainability. European suppliers are at the forefront when it comes to making vehicles continuously more sustainable, smart and safe with the help of advanced powertrain solutions, connectivity and automation. Substantial R&I investments are crucial for the development of affordable mobility. Particularly in today’s time of rapid change, with the unfolding transition to a green and digital societal, the impact cannot be underestimated, and is essential for the competitiveness for our industry.

2021 will be an extremely dense year from an EU policy perspective. We expect regulatory proposals on crucial topics such as CO2 emissions, Euro 7, data use and access, artificial intelligence, and the organisation of the aftermarket. Sustainability criteria and circular economy requirements will continue to fuel policy debate as well.

For businesses and policy makers, a major challenge will be to manage the transition in an inclusive and competitive fashion. Our primary objective, as industry, is to transform the mobility of tomorrow, to up- and re-skill our workforce and to keep R&D highest on our priority lists. As part of the implementation of a renewed European industrial strategy, it will be crucial to analyse the specific needs of industrial ecosystems such as ours, to tailor political support and measure impact on competitiveness and employment—all of course within the broad policy agenda of the EU Green Deal and digital transition.

The year 2020 has been one like no other. Working together has been instrumental to cope with the many challenges and this will be no different in 2021. The COVID crisis has shown the value of standing strong, together. In this spirit, we look forward to working with our customers, stakeholders and policy makers again also in 2021, advancing sustainable mobility and a competitive industry in Europe.”

 

Thorsten Muschal is Executive Vice President of Sales and Program Management at Faurecia, and CLEPA President since 2020.

 

EU-China investment agreement is hopeful sign, but clarity on substance is critical

Europe’s automotive suppliers welcome the conclusion of negotiations between the EU and China on a Comprehensive Agreement on Investment

in CLEPA, 30-12-2020


Sigrid de Vries, CLEPA secretary general, comments: “China is our industry’s second most important investment destination and European automotive suppliers are the biggest foreign investors in the sector in China. There are growing concerns that investment and market access conditions in China are uncertain and do not reflect the openness of the European market. A deal that secures and improves reciprocity in market access and investment conditions is therefore crucial for our industry and the protection of hundred thousands of jobs across the EU and China.”

European suppliers would support a deal that eliminates hurdles for investment in so-called new energy vehicles, provides enhanced protection of intellectual property and introduces more transparency and disciplines on state aid to establish a level playing field and reduce market distortions. Lastly, the deal could provide a meaningful institutional underpinning for cooperation between the EU and China to achieve climate neutrality and address human rights concerns.

CLEPA wants to acknowledge the efforts on both sides over the past seven years to come to an agreement. De Vries: “With the political decision to conclude negotiations being taken, it is now critical that the European Commission engages with all stakeholders to provide more clarity on the substance of the agreement. European suppliers currently lack sufficient detail on the Comprehensive Agreement on Investment to assess whether the sector’s concerns are sufficiently addressed. CLEPA is ready to scrutinise the agreement in principle and contribute to the next steps.”

 

Automotive suppliers comment on the EU-UK trade deal

The European Association of Automotive Suppliers, CLEPA, welcomes the Christmas trade agreement between the EU and UK and thanks all parties involved for their commitment to getting a deal agreed. This deal represents the starting point to ensure the continuation of the cooperation for both sides.

in CLEPA, 24-12-2020


Sigrid de Vries, CLEPA Secretary General, commented: “This deal avoids what would have been a worst-case scenario for European suppliers and the many jobs depending on the EU-UK trade relationship. Businesses and customs authorities now need The European Association of Automotive Suppliers, CLEPA, welcomes the Christmas trade agreement between the EU to work around the clock to get ready for the new trading conditions only one week before its implementation. We ask policy makers to engage with us to ensure trade in components is not needlessly being hit by tariffs and to avoid disruption at the border.”

CLEPA will analyse the technical details of the deal as soon as all the material is published to assess the extent into which this deal will serve the interests of the highly integrated EU/UK automotive supply chain, and refrain from commenting on the substance of the deal before then. Already certain is though that the deal will not avoid the resurrection of many trade barriers. We will therefore continue to work constructively with our partners in the EU and the UK to ensure that this free trade agreement proves a first building block rather than an end point.

 


 

About CLEPA

CLEPA, the European Association of Automotive Suppliers based in Brussels, represents over 3.000 companies, from multi-nationals to SMEs, supplying state-of-the-art components and innovative technology for safe, smart and sustainable mobility, investing over 30 billion euros yearly in research and development. Automotive suppliers in Europe employ about five million people across the continent.