Institut Mobilités en Transition’s Post

Yesterday, I participated in the workshop convened by Executive Vice President Séjourné on the future of the European automotive supply chain. The discussions highlighted diverging perspectives on the challenges and risks among different actors in the value chain: European car manufacturers seek to continue leveraging global competition to enhance productivity and competitiveness, while some traditional European suppliers are warning about the deteriorating situation for projects and for European industrial sites, which could ultimately weaken the entire European industry. A growing number of these suppliers are now calling for measures to secure demand for "Made in Europe" products through either incentive-based or mandatory policies. The idea of promoting or creating demand for components or materials with local content or local added value (i.e., produced in European industrial sites) is gaining traction, including in the Competitiveness and Decarbonization Plan unveiled yesterday by the European Commission. The industrial policy to be developed under the Commission’s leadership must aim to reconcile and realign the interests of the entire European-based value chain. The challenge for all stakeholders is to strike a balance between short-term performance while ensuring long-term resilience. Indeed, no player can survive without a strong European supply chain capable of supporting both productivity and co-innovation. We sought to demonstrate that there are several viable and agile ways to introduce a degree of protection by integrating local content and eco-score requirements or incentives into (1) the current EU regulatory framework (without the need for new regulations), (2) demand-stimulus initiatives for low-carbon vehicles, and (3) existing financing mechanisms. We called on the Commission to launch working groups to define these new industrial and sovereignty policy tools, leveraging Europe’s environmental ambitions as a competitive differentiator in favor of "Made in EU," while strengthening the competitiveness of European production sites. This is a first step toward structuring and reinforcing the Automotive Plan, without the need to arbitrate between decarbonization, competitiveness, and long-term resilience.