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Tariffs On Environmental Protection And Bilateral Pressures, The European Automotive Industry Faces Serious Challenges
- Oct 17, 2018 -

The European automobile manufacturing industry has come one after another. Following the US threat to raise tariffs, the European Parliament has recently decided to set stricter carbon emission limits, and manufacturers will be required to pay fines if they fail to meet the standards. The European Union will discuss these strict requirements on October 9.


Cars are an important industry in Europe. Challenges have come one after another. First, US President Trump once threatened to impose a 25% tariff on imported cars and parts in Europe, forcing Jean-Claude Juncker, chairman of the European Union Executive Committee, in July. I personally flew to Washington to negotiate with Trump to temporarily resolve the crisis.


Trump is particularly worried about the increase in tariffs, as Germany is the home of large automakers such as Volkswagen and Daimler, which may be the first to bear the brunt. The German auto industry has warned that if the US raises import tariffs, it may increase auto manufacturing costs by $83 billion, causing hundreds of thousands of people in auto-related industries to lose their jobs.


However, although Trump suspended the tariff on European cars in July, it also provoked this sensitive issue at the end of August. When EU Trade Commission Executive Cecilia Malmstrom proposed that the EU is willing to reduce all vehicle tariffs to Zero, the premise is that the United States was vetoed by Trump when it was processed. He believed that the proposal was "not good enough" and the US-European auto tariff war could come back at any time.


In addition to the trade war with the United States, European automakers are also experiencing “environmental” pressures; according to the European Court of Auditors (ECA) report in September this year, EU countries have failed to meet air quality standards. More than 1,000 people die every day, which is 10 times the number of deaths caused by traffic accidents.


The EU air pollution has caused a major health crisis, and the pollution sources mainly come from high concentrations of suspended particulates, nitrogen dioxide and ground-level ozone. Among them, diesel engines are a major source of pollution. Environmental groups are constantly asking automakers to reduce the emission of harmful substances from new vehicles. .


However, in 2015, the Fox Group in Germany broke out the "diesel door" scandal, and was kicked out to install a reduction device for a total of 11 million diesel vehicles worldwide, which was used to defraud the exhaust gas test. However, in actual driving, the vehicle emits harmful substances up to the prescribed value of 40. Times.


In order to reinvigorate the reputation of the European automotive industry and reduce air pollution, the European Parliament passed a resolution on October 3 to set stricter carbon dioxide emission limits. In 2030, the carbon reduction of new vehicles will reach 40%, compared with the original EU. The Executive Board's proposal version is 30% higher, which is twice as high as the 20% acceptable to automakers.


The European Parliament also decided that if the automaker fails to meet this goal, it will have to pay a fine; another manufacturer needs to ensure that the low-carbon vehicles will reach 20% in 2025 and 35% in 2030.


The European Parliament acknowledged that this will pose serious challenges to the European automotive industry, but stressed that the EU should start taking countermeasures as early as possible, such as upgrading employees' skills or changing jobs, and actively encouraging the development of the battery manufacturing industry. The EU will also meet on October 9 to discuss this series of strict Claim.