Brussels. Europe's automotive industry is under massive pressure. High tariffs, rising energy costs, and a tight supply of rare earths are putting manufacturers and suppliers alike under stress. Tens of thousands of jobs have already been lost or are under threat. Observers warn that if Europe does not act quickly, it could jeopardize not only its climate targets, but also its technological lead and economic growth. Nevertheless, European governments are finding it difficult to agree on joint, effective measures.
In an unusual initiative, 19 European heads of state and government have issued a joint appeal to the President of the European Council. In it, they call for a return to the reform proposals of former ECB President Mario Draghi and greater efforts to improve European competitiveness. They particularly emphasize the need to simplify sustainability policies and strengthen the single market. However, Draghi's report also contains a separate chapter on the automotive industry, in which he calls for a technology-neutral revision of the CO₂ regulation – an aspect that has received too little attention to date.
France and Spain recently presented a paper that essentially confirms the existing CO₂ regulation, but with certain flexibilities. However, experts consider the simultaneous support of both approaches to be contradictory.
Europe has the tools – it just needs to use them
While political discussions continue at the highest level, global competition is changing rapidly. Countries such as China and the US are focusing on open, consumer-oriented strategies. Plug-in hybrids continue to be in demand there, and artificial intelligence and data play a central role in their mobility strategies.
In Europe, too, consumers remain open to hybrid drive solutions, and suppliers are signaling their willingness to invest. The industry association CLEPA has presented concrete proposals to specifically promote consumer behavior toward plug-in hybrids and ensure that electric driving remains possible in all practical situations.
According to industry representatives, an adjusted approach to calculating the so-called utility factor – i.e., the share that the electric drive must contribute – is not a step backward, but a necessary adjustment to reality. Consumers need support and time to make the transition, while politicians and industry must ensure fair framework conditions and technological advancement.
Decarbonization requires production – not just visions
A key risk of the green transition is the loss of entire value chains. The example of the solar industry has shown how European investments can flow out to other regions of the world. Experts are therefore calling for binding requirements for local content to ensure that Europe remains more than just a showroom for clean technologies.
Local production not only means secure jobs, but also industrial resilience, innovative strength, and the preservation of economic sovereignty. “The green transition must not weaken our industrial base, but must strengthen it,” say industry circles.
While there are still no bans on combustion engines in the US and China, the industry in Europe is warning of the consequences of too abrupt a transition in 2035. A flexible, gradual approach is necessary to ensure consumer acceptance and maintain industrial momentum.
The clock is ticking
The decisive question now is whether Europe will shape the next era of mobility or watch from the sidelines. In view of the upcoming decisions, there is a rare opportunity to correct structural weaknesses before they become permanent disadvantages.
Industry representatives are therefore calling for a pragmatic review of CO₂ regulations that takes equal account of European interests, competitiveness, and citizens' needs. Only if Europe defines its own path with clarity and realism can the continent ensure that the green transition actually takes place in European factories – and not in the showrooms of other regions of the world.
