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European Commission unveils CARS 2020 Action Plan

The European Commission has unveiled its CARS 2020 Action Plan aimed at reinforcing the automotive industry’s competitiveness and sustainability heading towards 2020.

The Commission proposes a massive innovative push by streamlining research and innovation under the European Green Vehicle Initiative. Co-operation with the European Investment Bank will be reinforced to finance an innovation boost and facilitate SME access to credit. An EU standard recharging interface will provide the regulatory certainty needed to facilitate a breakthrough for large scale electric car production.

Innovation in the automotive industry will also be stimulated through a comprehensive package of measures to reduce CO2, pollutant and noise emissions, to drive improvements in road safety and develop technologically-advanced intelligent transport systems (ITS).

In parallel, the Commission also proposes to address the immediate problems in the car sector. In response to a fall in demand on European car markets and plant closure announcements, the Commission will in November bring together car producers and trade union representatives and Ministers of Industry ahead the next Competitiveness Council to review measures for dealing with the present crisis in a co-ordinated way. The car industry is important throughout Europe and a European response is needed. This response should focus on addressing overcapacity, social and technological investment, as well as state aid and demand-side measures, followed by a discussion at the political level.

European Commission Vice-President Antonio Tajani, Commissioner for Industry and Entrepreneurship, said: “Europe produces the best cars in the world. The Commission wants this leadership to be maintained, moving even further ahead in safety and environmental performance. The Commission is therefore today presenting a strategy for the EU automotive industry and will also take urgent action to address this sector’s current difficulties and restructuring in a co-ordinated way. This automotive plan is the first fruit of the Commission’s strategy for a new industrial revolution, presented on 10th of October. The automotive industry has all the assets to overcome current problems, remain competitive, become more sustainable and retain its manufacturing base in Europe. What is more, because of the multiplier effect it has in the economy, the car industry should provide a strong impetus to maintain a strong industrial base in Europe. Today’s Action Plan will give the car industry all possible political support.”

Globalisation and new technologies offer opportunities in an increasingly competitive sector

There is likely to be a major increase in the number of cars sold in emerging countries in the coming decade, offering opportunities for the EU car industry, but with high pressure to improve sustainability and to address increasing global competition.

The Action Plan comprises concrete proposals for policy initiatives in order to:

1. Promote investment in advanced technologies and innovation for clean vehicles, for example by:

a comprehensive package of measures tackling CO2, pollutant and noise emissions reduction
pursuing road safety measures, including Intelligent Transport Systems
the deployment of infrastructure for alternative fuels (electricity, hydrogen and natural gas)
an EU standard for the recharging interface for electric vehicles
a European Green Vehicles Initiative under Horizon 2020 to promote investment in research and innovation.

2. Improve market conditions, for example by:

strengthening the Single Market for vehicles through an improved type-approval system, including market surveillance, to avoid unfair competition.
streamlining of financial incentives for clean vehicles.
consistent application of the smart regulation principles, including the application of competitiveness proofing for major policy initiatives to estimate the specific impact of major policy initiatives on the automotive industry.

3. Support industry in accessing the global market through:

the conclusion of balanced trade deals, careful evaluation of the cumulative impacts of these trade deals as well as promotion and continuation of bilateral dialogues with major third country partners, and
intensifying the work on international harmonisation of vehicle regulations with the ultimate aim of achieving an international car type approval and global safety requirements for electric vehicles and their batteries.

4. Promote investment in skills and training to accompany structural change and anticipate employment and skills needs, for example through encouraging the use of the European Social Fund (ESF) for this purpose.

The Commission and Member States must now implement the policies announced. The role of the automotive industry will be to achieve the new ambitious objectives established. In order to monitor this process, and continue the dialogue with the stakeholders a dedicated process will be established called “CARS 2020”.

The automotive industry as a whole (automotive producers, supply chain and aftermarket, including thousands of SMEs) is of strategic importance to the European economy, representing 12 million direct and indirect jobs, 4% of GDP and a €90 billion trade surplus (in 2011). This industry is the biggest private investor in research and innovation, spending around €30 billion annually.

The Action Plan represents the first concrete delivery of the new policy priorities proposed in the recent Communication on industrial policy. It builds on the outcome of the CARS21 High Level Group, in which seven Commissioners, as well as Member States and key stakeholders (including industry representatives and NGOs) were represented. Re-launched in 2010, the CARS 21 Group adopted its Final Report in June 2012.