The European automotive supply industry is heavily impacted by the Corona-19 crisis, and working hard to resume manufacturing and reconnect supply chains after an unprecedented and almost complete standstill of production. European governments can help with a coordinated relaunch plan which prioritises employment and innovation in Europe as well as underpins the transformation to carbon neutrality and digital society.
First priority for the industry remains the health and safety of employees and society at large. A successful exit from the crisis will however require timely and decisive coordination between member states to restore the free movement of goods and people, making sure that all players in the value chain can plan and act as effectively as possible. The automotive eco-system resembles an intricate clockwork, and the overall chain is as strong as it weakest link.
Liquidity support in the form of flexible state aid rules, tax breaks, investment guarantees, loans, temporary unemployment schemes and other measures remains crucial. In addition, it will be essential to support the recovery with immediate, targeted measures to trigger demand, such as tax reductions or other purchase incentives as well as stimulus through public procurement. Purchase incentives will help to bring back capacity utilisation quickly and therefore, safeguard jobs and investment capacity.
