Challenging times for the EU auto industry and the millions of Europeans that are its backbone

The effect of the coronavirus on the automobile industry is unprecedented. With nearly all vehicle manufacturing in Europe having come to a halt and the retail network now effectively closed, the jobs of 13.8 million Europeans are at stake. Indeed, it is becoming increasingly clear that COVID-19 has led to the worst crisis ever to impact the automotive sector.

Message from ACEA's Director General – March 2020

Across the EU vehicle makers operate 229 assembly and production plants, directly employing 2.6 million Europeans in manufacturing. However, ACEA’s 16 member companies have had to announce temporary closures of many of these plants due to collapsing demand, supply shortages and government measures, and they are facing cases of corona and quarantines among employees.

It goes without saying that the health of those people that form the backbone of our industry, and their families, is paramount to Europe’s automobile manufacturers. But at the same time, ACEA also calls for strong and coordinated actions at national and EU level to provide immediate support for automobile companies, their suppliers and dealers. Especially now that they are proving their added value to society in these times of crisis.

In particular, I would like to draw your attention to the fact that commercial vehicles, such as trucks and vans, are playing a critical role in the well-functioning of our societies today. The vehicles that our members make are indispensable tools that ensure that medicines, food, fuel and medical supplies are being delivered across the EU. But Europe’s real heroes are of course the truck drivers that work long hours to make sure that supermarket shelves are stocked and emergency hospitals can be built.

ACEA’s members are also stepping up efforts to help address shortages of medical equipment and supplies. For instance, wiper motors that go into trucks are now donated to universities to develop ventilators that help COVID-19 patients to breathe when their lungs fail. 3D printers and robots usually employed in automotive manufacturing are making medical parts needed to keep people alive. Likewise, high-quality mouth masks that auto makers bought for use in their paint shops are being donated to hospitals. And in areas where public transport has come to a standstill, ACEA members are providing vans to transport medical staff and supplies.

Now, departing from the usual format of my monthly messages, I would like to take this opportunity to give you a more ‘hands-on’ update on ACEA’s work on the coronavirus. Let me, first of all, assure you that this is the number one priority of the whole ACEA team right now.

The ACEA offices in Brussels are closed for the time being, but from home we are all working harder than ever to support the automobile industry through this unprecedented crisis. ACEA is taking many actions and we are focusing our efforts as much as possible on mitigating the impact of the COVID-19 crisis on the auto sector. The first action we took was to create a dedicated ACEA Task Force, which is busy working on a multi-pronged approach that includes:

  • Gathering information on the impact of the coronavirus on the industry, such as the effects on employment, production, supply and orders.
  • Monitoring measures taken by the European institutions and national governments.
  • Analysing implications for regulatory affairs, starting with an inventory of EU legislation, regulations and consultations that may be impacted.
  • Interacting with policy makers and coalition-building with other stakeholders.

Moreover, we have also launched a dedicated section of our website for all of our publicly-available information on the impact of COVID-19 on the auto industry.

Right now you will find the following information here:

  • Two interactive maps visually showing the impact on the automobile industry in each EU member state, both in terms of number of employees affected and lost production. These maps – providing the only EU-wide overview of its kind – will be updated by ACEA on a weekly basis.
  • The statement we issued to media in order to emphasise the scale of the hit that our industry is taking, and to make a call for strong and coordinated action at EU and national levels.
  • A joint letter written by our President, Michael Manley, as well as the presidents of CLEPA, ETRMA and CECRA (the European associations representing suppliers, tyre manufacturers, dealers and repairers) to the President of the European Commission, Ursula von der Leyen, about the implications of COVID‐19 on the whole automotive sector, and the measures that the Commission could potentially take in this respect.
  • An overview of measures already taken at EU level by the European Central Bank, the European Investment Bank and the European Commission to support affected workers and companies.

Please keep an eye on this web page, as we will be continuously updating it with new information as our work progresses.

Looking at the current crisis from a policy point of view, I would like to stress that we appreciate the measures that have already been announced, which provide much needed immediate support for employees and companies alike. But we now also need an urgent dialogue with the President of the European Commission to do two important things.

Firstly, to take concrete measures to avoid irreversible and fundamental damage to the sector with a permanent loss of jobs, capacity, innovation and research capability. Secondly, we believe that Europe should prepare to stimulate the recovery of our sector, which will be a key contributor to the accelerated recovery of the European economy at large.

In an effort to look beyond the immediate crisis, as ACEA we already started to explore how a synchronised restart of our companies and their supply chains could be facilitated in a smooth way. Working together with our members we want to ensure that life and business can resume as quickly as possible once the pandemic ceases and health measures can be lifted.

Indeed, ACEA stands ready to work with the European Commission, national governments and other stakeholders to navigate through this unfolding crisis. So far, we already had several constructive discussions with the most important Commission cabinets. The aim of these initial talks is to provide insight into the challenges that our industry is facing, to better understand how the Commission is tackling this unprecedented crisis and to see how ACEA can facilitate their work to ensure the EU auto industry is supported in the right way.

Because the financial impact of the COVID-19 crisis on our sector is severe. Both the production and sales of motor vehicles have come to a sudden standstill in most of Europe and other regions in the world. Workers who sit at home see their income reduced as their (temporary) unemployment benefits are lower than their salaries, sometimes significantly. At the same time, their monthly bills for rent and energy as well as their repayments of loans and mortgages remain unchanged. All of this coming on top of workers’ concerns about the health of their family members and friends. 

This goes to show that the COVID-19 crisis will have grave consequences for Europe’s automobile manufacturers and their employees, going far beyond what we can foresee now.

I hope this summary is useful to you, we will ensure to keep you posted over the weeks and months ahead. Wishing you all the best during these very difficult times, I hope that you and your families are healthy and safe!

Yours sincerely,

Eric-Mark Huitema
Director General of ACEA

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