Business is calling on the EU to guarantee the industrial capacity of the automotive sector

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The Deputy Minister of Economy and Competitiveness, Carlos Martín Tobalina, took advantage today of his presence at a conference organized by the Automobile and Mobility Cluster of Castile and León (FaCyL) to ask for subsidies from the European Union for the industrial capacities of automobile factories installed, through which In addition, aid that companies receive for the development of research and development (research and development). It was not for nothing that he emphasized that Europe needed to know “what it wants in order to become bigger” in a sector as important for the economy and employment as the automotive industry.

Therefore, he considered that Europe must be “able” to examine and propose direct investment aid for manufacturers in new capacities in order to maintain industrial capacity and, above all, employment. And the deputy minister recalled that industrial employment related to the automotive industry is the most important in Europe, and even more so in Castilla y León.

Martín Tobalina assured that there are other continents and markets that have “much stricter” criteria than those in Europe, to the point that he did not hesitate to say that they have already overtaken him and he has lost his leadership in the automotive sector. It is not for nothing that he emphasized that Europe competes with countries subject to different criteria, such as the United States, which finances and subsidizes the development of new industrial capacity, and China, which plays with different “rules” and costs.

For this reason, the Deputy Minister of Economy and Competitiveness has decided to take measures to make the automotive industry “much more competitive” as there is great competition in the market at a time when European factories are adopting their technology without affecting its industrial capacity.

Martín Tobalina pointed out that the Euro 7 Regulation is a framework that needs to be adapted and is recommended. “Another thing is that the problem lay in the strictness of these regulations and how they could affect the industrial capacity already installed in the short term, as factories were forced to make significant investments in a very short period of time.” Ultimately, this framework became softened to link the market to the needs,” he explained.

In this sense, he appreciated that the European Union is driving forward a transition process towards other new technologies, while thinking about the environment and “not throwing stones on our own roof”. For this reason, he congratulated the Spanish Government for the work done to promote the “sweetening” of Euro 7 and to ensure that companies in the automotive sector, including those in Castilla y León, are not forced into this regulatory imposition and obligation to make investments, and at such short notice that they could jeopardize part of their capabilities.

He added that a window opens in 2026 to “rethink” the process of adapting to new technologies, with the aim of allowing the coexistence of internal combustion engines with electric motors. In this way, there will be a chance for existing production capacities to continue as long as they meet the emissions criteria.

Recovery in 2023

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The deputy minister highlighted that the automotive sector represents a quarter of Castilla y León's gross domestic product (GDP), almost two and a half times more than at national level, which is about ten percent. Therefore, it is the reference sector in terms of activity generation, export weight and employment. Something that was restored in 2023 by noting that the “good behavior” of the factories operating in the community, both vehicle manufacturing and the more than 150 supplier companies, represents a “fundamental” ecosystem for the regional economy.

He highlighted the good health of the factories, both at Renault in Valladolid and at Palencia and Horse, which have increased their production, but also at Nissan in Ávila as a supplier to the sector, especially the Renault group. He also did not forget the Iveco plant in Valladolid, as it is a global benchmark in the group, whose production figures are above “expectations” and have “good” future prospects.

In this sense, the President of FaCyL, Félix Cano, also expressed himself, who congratulated himself on the fact that Spain had recovered more than 80 percent of its pre-pandemic values, having started last year with the production of 2.5 million vehicles, of which 90 percent, completed had been exported. He pointed out that in some factories production has decreased, which is not the case in the factories in Castilla y León. He named Renault Palencia, which is up 30 percent; The French group's factories in Valladolid are involved between five and ten percent and Iveco “significantly” with the production of 70 daily vans in each shift and a ten percent share of the trucks that the brand assembles in Madrid.

Against this background, he regretted that vehicle sales in Spain have not performed so well, remaining at 950,000 vehicles in 2023, after reaching 1.5 million a year before the pandemic. Data he related to the “bad” circumstances in the world, with two wars, the effects of the pandemic and inflation. “The pockets hurt and the uncertainty doesn’t help either,” he said.

It is not for nothing that Cano believed that the way to improve the numbers is to have adequate and more flexible plans that encourage the purchase of vehicles, after calling Moves a “failure”. In his opinion, the reserved funds had not been used sensibly, and he also criticized the fact that Spain was lagging behind in installing charging stations for electric vehicles. “In the end, people hold back and prefer to wait and see where the shots go,” he added. For this reason, he expressed hope that the new government will end this uncertainty and that this will benefit a sector that needs to retain and attract talent. “We have to regain the old positions that the sector had in Spain. “At the moment, according to the data for 2023, we have already overtaken Brazil and are the eighth largest automobile producer in the world,” he said.

Cano also advocated improving the training of workers in the industry in new technologies and making efforts in cybersecurity, as there are “many” attacks on their companies that have “many secrets” to keep.

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