GEAR 2030 Final Report: European automotive competitiveness in 2030
On the 18th of October 2017, the High Level Group on the Competitiveness and Sustainable Growth of the Automotive Industry in the European Union, set-up by the European Commission and where CLEPA was seating, adopted its final report “Ensuring that Europe has the most competitive, innovative and sustainable automotive industry of the 2030s and beyond”.
The EU’s automotive sector enjoys a central place in Europe’s industrial landscape. It is the employer of millions of Europeans, often in highly skilled jobs and a major investor in research and development. The sector is one of the most competitive in the world and generates a substantial trade surplus for the EU. It is at a junction of many important EU policies including; competitiveness, research, energy, environment, transport, single market, etc. Today’s automotive industry is at a turning point: it must embrace the upcoming digital revolution, automated and connected driving, environmental challenges (such as climate goals), societal changes and growing globalisation.
In order to develop a co-ordinated and effective EU approach for the automotive industry in this changing landscape, the European Commission established the High Level Group (HLG) GEAR 2030 in October 2015. The group brought together Member States’ authorities and key stakeholders representing the industry, services, consumers and environmental protection and road safety. This Report sets out the HLG’s analysis of the situation and recommendations to address the main challenges and opportunities for the sector in the run-up to 2030 and beyond. It examines the developments in global competitiveness and changes in the value chain. In this context, given the profound impacts of the transformation on the entire value chain, the HLG decided to focus on connected and automated driving (CAD) and on zero emissions and zero emissions-capable vehicles (ZEVs and ZECs). However, the HLG also recognises that cleaner internal combustion engine (ICE) vehicles will have an important role in the on-going transformation of the sector. They will be especially important in the case of heavy duty vehicles to help their transition to low and zero emission technologies.
Regarding global competitiveness and access to markets the HLG recognises that the European automotive sector is globally competitive and it is in a strong position to take advantage of opportunities created by new technologies, changing consumer demand and the growth in overseas markets, especially in China and India. At the same time, growing competition from non EU manufacturers on the EU market is becoming a major challenge. An ambitious but realistic, cost effective and properly enforced EU regulatory and policy environment can support technological development, competitiveness and play a leading role in worldwide efforts to enhance environmental protection and improve safety of road users. Furthermore, the HLG stresses the importance of global technical harmonisation under the United Nations Economic Commission for Europe (UNECE) framework as a key factor in strengthening global competitiveness, reducing redundant development and testing costs and avoiding duplication of administrative procedures. The HLG also recommends that the Commission pursues bilateral regulatory dialogues to ensure common approaches with important third country markets and, if necessary, make use of trade policy instruments against unfair trade practices and protectionism measures to ensure there is a level playing field with the EU.
The European automotive sector is expected to undergo structural changes in its value chain due to the development of digital technologies and the shift towards low and zero emission mobility. The industry, in particular SMEs, will need to assess and, if necessary, redefine their position in the value chain as well as increase their capacity to integrate digital technologies, alternative powertrains and circular economy concepts in their products portfolio and production processes. The Commission and Member States stand ready to support and stimulate this transition. The HLG highlights that the transformation of the automotive industry will have a significant impact on the industry’s workforce and also, more widely, in the transport sector. The HLG proposes measures that should be developed at the level of the industry, Member States and EU to support the acquisition of new skills, retain and reskill the workforce in the sector. Such measures could include supporting mobility and transferability of skills, developing a well-functioning apprenticeship market and encouraging non-formal learning certification. Finally, automotive regions affected by the low-carbon transition of the industry should be supported by the deployment of Smart Specialisation Strategies and comprehensive regional development plans.
The HLG recognises the ever-increasing importance of ZEVs and ZECs for the sector. The industry and Member States will need to step up measures to tackle urban air pollution and meet long-term objectives in reducing greenhouse emissions by 2030 and beyond and respond to the challenge posed by new market entrants. This must be supported by an appropriate technology neutral regulatory framework, variety of incentives at national and local level, faster development of refuelling and recharging infrastructure and further progress in batteries technology. EU CO2 fleet emission regulations are recognised as one of the most effective EU-level tools for driving fuel efficiency, creating a level playing field, ensuring market predictability and stimulating innovation. The existing emission targets are being revised for the post-2020 period. It is now crucial to set a framework that uses all options to reduce emissions and supports the market penetration for ZEVs and ZECs vehicles. A key element to the potential success of ZEVs and ZECs is the need for improved performance of batteries. The HLG therefore recommends the setting-up of an industryled initiative to support measures for research, development and, in particular, manufacturing of the next generation of battery cells and packs in the EU, jointly with the Member States and the Commission.
The HLG stresses that Europe needs a shared strategy on automated and connected vehicles as underlined in the Amsterdam Declaration of 14 April 2016. These technologies are already coming to the EU market in line with a global trend and represent challenges and opportunities for the EU competitiveness and for EU policies. EU governance is needed in particular to take the full benefit of large scale testing and research and financing programmes both at the EU and at Member State level. Strategic planning and public private partnerships could help. As these vehicles will take over some tasks of the driver there is a need to develop rules on data recording (black boxes) and associated data access rules. The expected tasks of the driver and performance of the vehicles also need to be regulated in traffic rules and vehicle rules in a coherent manner within the respective responsibilities at EU and national levels. This also calls for a new approach on vehicle approval. The EU framework should encourage the necessary investment in connectivity in vehicles and in the infrastructure. Finally, the long term impact of increasingly automated and connected vehicles, in particular on jobs and ethical issues should be assessed, discussed and included in broader EU policies (e.g. transport, regional development, jobs and skills) to ensure social acceptance.
The Report concludes with a number of recommendations to ensure that there is a co-ordinated and collective implementation effort to help the strategically vital automotive sector meet the challenges, and take advantage of new opportunities, in the coming years. The implementation of these recommendations will require a follow-up by the Commission together with relevant Member States’ experts, the industry and other stakeholders.
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