Support measures

The European Automobile Manufacturers' Association (

) has urged the European Commission (EC) to employ a range of measures to support the car industry and prevent a prolonged period of recession.

Data from the ACEA shows that vehicle production fell by 28 per cent in the last quarter of 2008. This figure is around 10 per cent more than previously forecast and the association predicts that, in 2009, European vehicle production will decline by a further 15 per cent if the European Union (EU) does not take drastic action.

Ivan Hodac, secretary-general of the ACEA, said: ‘The EU has started filling a toolbox with potential instruments but too little of them have been actually put into use due to time-consuming procedures and a lack of guidance at EU level.’

According to the ACAE, the key issue that the EU needs to address is freeing up credit for companies amid the current financial crisis. The ACAE also wants further action to be taken to reduce costly regulation and to introduce fleet renewable incentives.

Hodac added: ‘The EU must show its ability to act in times of crisis. EU leaders, at their summit this weekend, should give the political message to lift bureaucratic barriers and speed up implementation. A coordinated European policy would not only ensure more fairness and respect for EU competition rules but, more importantly, greater efficiency in a single, European market.’

The EC's recent paper on the automotive industry has been welcomed. Hodac said: ‘The paper clearly shows the need for urgent action and lists various options. What we now ask is to add an early deadline to each suggested measure.’

Among the measures outlined it the paper, the importance of the CARS21 process was highlighted as an early-warning mechanism for developments that affect the European car industry.

However, the industry has called for further action, particularly for the European Investment Bank (EIB) to increase its funding by up to €40bn (£36bn) and to shorten its validation process for projects.

The ACEA also wants a higher level of intervention from the EIB to relieve the cost of temporary unemployment, as well as the introduction of actions to stimulate demand such as market incentives, public spending on infrastructure and vehicle scrappage schemes.