The automotive industry

The automotive industry is not the power in Europe that it once was. At its peak, the makers of cars, buses and lorries plus the manufacturers of engine and body parts had so much industrial and economic muscle - since they were so important for the economy and employed so many people - that they could dictate terms to national governments.

That is no longer the case, though the carmakers still retain a significant role in several national economies. The balance of power has shifted. Economies are more diversified and national governments are less dependent on their particular national champions. In a global market, European carmakers face competition from rival brands.

Nonetheless, the carmakers are still one of the industrial sectors attracting the greatest attention from EU lawmakers. The automotive industry’s economic impact still matters - and Günter Verheugen, the European commissioner for enterprise and industry, launched the CARS 21 initiative in 2005 with the aim of maintaining the competitiveness of European firms. Its environmental impact is of ever-increasing concern. The Commission declared earlier this year its intention to legislate to combat the climate-change effects of cars on the EU market, principally by setting targets for emissions of carbon dioxide from cars. Next week (3 May) the European Parliament’s environment committee will have its first discussion of the plan and aims to submit its report at the end of June.

But car emissions are not the only area in which the EU is introducing regulation. Transport is taking up ever more energy resources at a time of increasing concern about energy supply and in turn that has prompted more and more research into cars that will run on different fuels. But even when new technologies become available, it does not follow that either the car industry or consumers will embrace them. European legislators are looking for ways to change behaviour, whether by direct regulation or by the introduction of fiscal incentives. Just as important for the EU lawmakers are regulations to ensure the safety of road transport, which is one of the major preventable causes of premature death.

Over the years, the automotive industry has shown itself to be highly effective at lobbying on the European stage - and plainly the legislative battles are not over. Across a range of issues - the environment, taxation, road safety, trade and intellectual property - the EU is now preparing policies and legislation which will shape the future of the European car industry.

The automotive industry is not the power in Europe that it once was. At its peak, the makers of cars, buses and lorries plus the manufacturers of engine and body parts had so much industrial and economic muscle - since they were so important for the economy and employed so many people - that they could dictate terms to national governments.

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