‘Most spectacular own goal in history’: new EU rules threaten to shut out UK car manufacturers
Summary
The European Union is creating new rules under the Industrial Accelerator Act that require cars and car parts to be made within the EU to receive subsidies or government contracts. These rules could block UK car manufacturers from the EU market, which is their largest export destination. The European Automobile Manufacturers Association and UK industry groups are urging the EU to give exemptions to the UK because car production between the UK and EU is highly connected.Key Facts
- The EU’s new “Made in Europe” rules require cars and parts to be produced inside the EU to qualify for support.
- These rules are part of the Industrial Accelerator Act, aimed at protecting EU car makers from cheap, subsidized products from China.
- The rules only apply to EU members, risking damage to UK car manufacturers that export heavily to the EU.
- The European Automobile Manufacturers Association (Acea) wants the UK, Turkey, and Morocco to get special exemptions.
- UK car plants are often owned by European companies like BMW, Volkswagen, Stellantis, Jaguar Land Rover, Ford, and Toyota.
- Nissan has warned it might close its Sunderland factory if the rules go forward unchanged.
- The UK and EU are each other’s largest markets for cars and parts, with over half of UK car exports going to the EU.
- EU leaders and industry groups hope to negotiate changes to avoid harming the integrated UK-EU car industry.
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