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    CARS 2020: Action Plan for a competitive and sustainable automotive industry in Europe

    The European Commission has launched the CARS 2020 Action Plan, which is aimed at reinforcing the automotive industry’s competitiveness and sustainability

    With 12 million sector-related jobs, the automotive industry is vital for Europe’s prosperity and job creation. The EU needs to maintain a world-class car industry, producing the most energy-efficient and safe vehicles globally and providing high-skilled jobs to millions. To make this happen, the European Commission has tabled the CARS 2020 Action Plan aimed at reinforcing this industry’s competitiveness and sustainability heading towards 2020.

    The Commission proposes a massive innovative push by streamlining research and innovation under the European Green Vehicle Initiative. Co-operation with the European Investment Bank will be reinforced to finance an innovation boost and facilitate SME access to credit. An EU standard recharging interface will provide the regulatory certainty needed to facilitate a breakthrough for large scale electric car production.

    Innovation in the automotive industry will also be stimulated through a comprehensive package of measures to reduce CO2, pollutant and noise emissions, to drive improvements in road safety and develop technologically-advanced intelligent transport systems (ITS).

    In parallel, the Commission also proposes to address the immediate problems in the car sector. In response to a fall in demand in European car markets and plant closure announcements, the Commission is bringing together car producers and trade union representatives and Ministers of Industry to review measures for dealing with the present crisis in a co-ordinated way. The car industry is important throughout Europe and a European response is needed. This response should focus on addressing overcapacity, social and technological investment, as well as state aid and demand-side measures, followed by a discussion at the political level.

    There is likely to be a major increase in the number of cars sold in emerging countries in the coming decade, offering opportunities for the EU car industry, but with high pressure to improve sustainability and to address increasing global competition.

    The Action Plan comprises proposals for policy initiatives in order to:

    1. Promote investment in advanced technologies and innovation for clean vehicles, for example by:

    • a comprehensive package of measures tackling CO2, pollutant and noise emissions reduction
    • pursuing road safety measures, including Intelligent Transport Systems
    • the deployment of infrastructure for alternative fuels (electricity, hydrogen and natural gas)
    • an EU standard for the recharging interface for electric vehicles
    • a European Green Vehicles Initiative under Horizon 2020 to promote investment in research and innovation.

    2. Improve market conditions, for example by:

    • strengthening the Single Market for vehicles through an improved type-approval system, including market surveillance, to avoid unfair competition.
    • streamlining of financial incentives for clean vehicles.
    • consistent application of the smart regulation principles, including the application of competitiveness proofing for major policy initiatives to estimate the specific impact of major policy initiatives on the automotive industry.

    3. Support industry in accessing the global market through:

    • the conclusion of balanced trade deals, careful evaluation of the cumulative impacts of these trade deals as well as promotion and continuation of bilateral dialogues with major third country partners, and
    • intensifying the work on international harmonisation of vehicle regulations with the ultimate aim of achieving an international car type approval and global safety requirements for electric vehicles and their batteries.

    4. Promote investment in skills and training to accompany structural change and anticipate employment and skills needs, for example through encouraging the use of the European Social Fund (ESF) for this purpose.

    The Commission and Member States must now implement the policies announced. The role of the automotive industry will be to achieve the new ambitious objectives established. In order to monitor this process, and continue the dialogue with the stakeholders, a dedicated process will be established called “CARS 2020”.

    The automotive industry as a whole (automotive producers, supply chain and aftermarket, including thousands of SMEs) is of strategic importance to the European economy, representing 12 million direct and indirect jobs, 4% of GDP and a €90 billion trade surplus (in 2011). This industry is the biggest private investor in research and innovation, spending around €30 billion annually.

    For more information visit:

    European Regional Development Fund Northern Powerhouse
    Partners Department for Business Innovation and Skills Finance Birmingham