Tuesday, March 5, 2024

Auto, De Meo brings Brussels back to reality. «With the closure of Euro7 factories»

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How heavy is the auto industry?

But de Meo pointed out the hypothesis that Brussels’ strictness towards four-wheel drive vehicles (which will have to reduce CO2 emissions by 100% by 2035, while the energy industry talks about 70% and for the rest of transport 50%) has an effect on what constitutes An industry of paramount importance to the continent’s economy: «We are talking about nearly 13 million jobs in Europe, 7% of the total. and 30% of total R&D spending on the continent, across all sectors. We are talking about vehicles, cars, commercial vehicles and trucks that ensure 80% of the movement of people and goods in kilometers every day. These proportions are expected to remain very similar through 2050.

Data that should make you think. De Meo explained that the response of European institutions is of fundamental importance. We need institutions on our side. We need it to be coherent, evidence-based and structured across sectors and stakeholders. We call on Europe to implement an ambitious auto industry policy that rivals that of other regions of the world, while protecting and promoting free trade on a global scale.”

With the closure of Euro 7 factories

Instead, for starters, there is the proposal for Euro 7, the legislation regulating diesel emissions from 2025. But that’s not all. De Meo also criticized the “Fit for 55” package and the ban on endothermic engines from 2035. Final price. With this increase, we estimate a significant decline in the new car market of about 7%. We know that people will keep old cars for longer or buy used cars instead of new ones. It is already happening and the vehicle fleet is aging everywhere ». In fact, the average age of European cars has increased again, to 12 years, in 2021.

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According to Acea, a much better cost-benefit ratio could be obtained if “the enormous investments that would be required by Euro 7 are refocused, allocated to accelerating electrification, making electric vehicles more convenient or reducing current emissions of the fleet”, for example through Low emission fuel. The Renault chief warned against illusions: conventional cars “will be the majority of the car fleet even after 2050; If we want to get to 0 by then, we will also have to face this challenge and that is part of the truth.” Ultimately, the Euro 7 proposal in its current form will have a strong impact on our business and our people. Deadlines are very short. Only in Renault can lead to Closure of at least four factories in a short time”.

Unequal arms conflict with the United States and China

Last but not least, very difficult confrontation with the United States and China. The first, reinforced by a recent law, the Inflation Reduction Act (IRA) that allocates nearly $300 billion to encourage the production and purchase of electric vehicles, but also production in the United States, also attracting European companies. The danger is industrial desertification in Europe. Allies of all time have come down to a level of fierce competition and in recent months there have been moments of tough confrontation. “Through the IRA we see the US catalyzing its industry in an ecological transition, while Europe’s approach is to regulate the sector, often in an asynchronous fashion,” was de Meo’s critique.

Wynne Dinwiddie
Wynne Dinwiddie
"Infuriatingly humble alcohol fanatic. Unapologetic beer practitioner. Analyst."
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