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MEMO/09/14

Brussels, 16 January 2009

Meeting with Ministers on the Situation in the Automotive Sector Brussels, 16 January 2009 - Conclusions of the Chairman Günter Verheugen, Vice-President of the European Commission

  1. Ministers welcomed the initiative taken by the Commission and asked to ensure appropriate follow up.
  2. The discussions confirmed the critical importance Ministers attach to the future of the automotive industry. They expressed deep concern about the serious situation that the sector is facing at present, putting at risk a very significant number of jobs. In 2008 there were about 8% fewer cars sold in the EU than in 2007. The worsening trend over the last months suggests that things will get worse in 2009 with another 10%-20% fall in sales. The projected figures for heavy-duty vehicles are even worse with industry projecting decreases of about 30%. The whole automotive value chain is already affected by the crisis and the impact is likely to be particularly painful for automotive suppliers, especially smaller suppliers.
  3. The primary responsibility to respond to these challenges rests with industry itself. The industry is encouraged to take all necessary action to address structural problems such as overcapacity and the need to invest into innovative technologies. These efforts should be taken in close cooperation with their employees and taking into account the suppliers' and retailers' needs.
  4. However, given the importance of this industry for the European economy and the fact that the sector is hit particularly hard by the current crisis, public support for this sector is decisive as reflected in the European Economic Recovery Plan and subsequent national programmes initiated or planned by Member States. It needs to support industry in the short term problems, while ensuring the long-term competitiveness of the sector. Ministers stressed that this requires clear focus on innovation ensuring high-tech solutions delivering in particular fuel efficiency and CO2 reduction. All efforts should target the production of world-class vehicles in terms of innovation, environmental performance and safety.
  5. There is agreement that such support needs to be effective and co-ordinated. It should respect key principles such as open global markets, fair competition, better regulation as well as cooperation and transparency. Any race for subsidies is to be avoided. In order to ensure better co-ordination, Ministers indicated willingness to closely cooperate with the European Commission on both the supply side and the demand side measures taken at national level, in particular on fleet renewal (such as scrapping incentives, taxation and public procurement), social transition and skill retention as well as action on financing and suppliers. On national measures requiring a reaction from the Commission, the Commission offered full assistance to Member States and swift action.
  6. There was a call from the Ministers upon the European Commission to advance rapidly with the implementation of the European Economic Recovery Plan, in particular as regards access to finance and retaining the skilled workforce through the European Globalisation Fund and the European Social Fund, as well as the Temporary Framework for more flexible application of the State Aid rules. The information given by the European Investment Bank was welcomed and the Commission was invited to explore, together with the European Investment Bank, how the utilisation of the loans envisaged for this sector can be further improved in terms of rapid availability, project financing and frontloading of the loans, without discriminating between manufacturers and Member States. Car producers including suppliers will have to be assisted by financial institutions in view of financing investments needed to comply with European legislation.
  7. The need for an early dialogue with the new US administration on the future of the automotive industry on both sides of the Atlantic was highlighted.
  8. The Czech Presidency announced to follow up today's discussion in the

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