Czech Business Today

European Commission President Ursula von der Leyen has initiated a strategic dialogue with key industry leaders, social partners, and stakeholders to address the challenges facing the European automotive sector. The goal is to develop solutions that ensure the industry’s long-term competitiveness and sustainability. The outcomes will be presented in an Action Plan on March 5.

The European automotive industry, employing over 13 million people and contributing approximately one trillion euros to the EU’s GDP, is at a critical juncture. The Commission is gathering inputs to create a regulatory framework that promotes innovation, fosters competitiveness, and ensures a level playing field in international markets. However, some key players, including SMEs and innovative firms, were notably absent from the initial discussions, raising concerns about the inclusivity of the process. Czech Transport Minister Martin Kupka has voiced his disappointment that Central European automakers were not included in the initial meeting. At the same time, he extended an invitation to European Commissioner Apostolos Tzitzikostas to visit Prague and meet Czech manufacturers, ensuring that the Czech Republic has a role in shaping the Action Plan. Kupka also emphasized the need to reform the current penalty system, suggesting the timeline for fines be extended over five years to give European automakers a realistic chance of bridging the technological gap with competitors.

On the same day, Czech and German leaders met in Prague to discuss the challenges facing the automotive sector, with the aim of aligning political actions and forming a unified European approach. The discussions focused on critical issues such as emission regulations, stagnating demand for electric vehicles, and the competitiveness of Europe in the face of pressures from the U.S. and China, as well as rising energy costs.

The European automotive sector faces intense pressure from stringent emission regulations, the transition to electric vehicles, and competition from Chinese manufacturers. Critics argue that the Commission’s dialogue favours large automotive manufacturers, particularly from Germany and France, and overlooks small and medium-sized enterprises, which form the backbone of the industry. The exclusion of these key players raises doubts about the Commission’s commitment to addressing the sector’s challenges comprehensively.

Industry leaders, including those from the Czech Republic, are calling for changes to the EU’s regulatory approach. They advocate for revisions to CO2 emission regulations, the cancellation of fines for failing to meet 2025 targets, and the abolition of the 2035 combustion engine ban. Additionally, they emphasize the importance of technological neutrality, encouraging the development of alternative fuels and hybrid technologies to ensure a sustainable and competitive automotive sector.

Source: Ministry of Industry and Trade , Ministry of Transport