For Hungary, which holds the six-month presidency of the EU Council, European competitiveness depends on a strong automotive industry. It hosted an informal meeting of industry ministers in Budapest on Tuesday 9 July, during which it advocated greater support for the automotive sector. The ministers or their representatives took part in a working session on the subject where they reflected on: - financial incentives to deploy more charging points for electric vehicles; - subsidies for the purchase of these cars; - measures to support the automotive industry.
According to Hungary’s Minister of National Economy, Márton Nagy, more coordination is needed on the continent to support the development of electric vehicles. With this in mind, he announced that on Wednesday 10 July, the Hungarian Presidency would publish a report on electric mobility, containing eleven concrete proposals.
According to a provisional version of the document seen by Agence Europe, Hungary is suggesting, for example, an “easing of rules regarding State aid in case of research and development and their industrial implementation and production of carbon neutral vehicles and its supply chain”.
State aid, coupled with European investment, is essential, according to Márton Nagy: “If you want to accelerate the transition, you can’t do it without subsidies”, he told Agence Europe.
He also said that demand needs to be stimulated. “In the current context, the situation on the continent is too fragmented to send clear signals to consumers”, he stressed. This is why the Hungarian Presidency is proposing the creation of a European subsidy of €4,500 for the purchase of a battery electric vehicle. “This EU-funded one-off subsidy can be funded from the income of CO2 premium of automotive industry, and from 2028 to 2034, in the new budget cycle, €50 billion from the MFF”, reads the Hungarian Presidency's provisional document.
On this proposal, some delegations warned against a one-off subsidy, which might not be enough to encourage people to buy an electric vehicle in certain regions of the continent with lower purchasing power.
The idea of subsidising manufacturers more to bring down the price of electric cars and investing in infrastructure seems to be gaining ground. With regard to recharging points for electric vehicles, for example, “most delegations agree on the need for action at European level”, according to Minister Nagy.
Competitiveness and fair competition
In the end, the reaction to Chinese competition in the automotive industry, which is often unfair, was barely touched on by the representatives of the Member States in Budapest. The European Commission’s decision to impose countervailing duties on Chinese battery electric vehicles (see EUROPE 13446/1) did not meet with unanimous approval in the EU Council. Many member countries fear a negative impact on the EU car industry and on economic relations with Beijing.
On the sidelines of the meeting, a number of delegations, led by Hungary, expressed their views on countervailing duties. “We don’t believe that's the interest of the European economy”, the Hungarian government’s international spokesman, Zoltán Kovács, told Agence Europe.
He said that enough Member States share this view and hopes that the procedure can be reversed. And to point out Berlin’s position, which is also opposed to countervailing duties. “If there’s one leading power actually in car manufacturing and technologies, that’s Germany. So we should listen to them”.
Berlin wants to avoid duties on Chinese electric vehicles (see EUROPE 13410/12), which it regards as harmful to its industry, which exports massively. This view is shared by other countries, including Sweden and Slovenia.
“We do not believe that imposing duties will help European competitiveness. We know that we are dependent on our partners in China”, Slovenia’s Secretary of State for the Economy, Matevž Frangež, told Agence Europe. (Original version in French by Léa Marchal)