EU Strategic Dialogue on Auto Industry Begins
The European Union’s Strategic Dialogue on the automotive industry’s future launches today.
Announced by European Commission President Ursula von der Leyen on November 27, the
initiative aims to address the EU automotive sector’s struggles by uniting key public and private
stakeholders. Core priorities include advancing digitalization and AI, promoting decarbonization,
addressing workforce challenges, modernizing regulations, and strengthening competitiveness.
The controversial Draghi Report (September 2024) identified the automotive sector’s
vulnerabilities, including high production costs, supply chain dependencies, and rising
competition from China, whose vehicles made up 18% of EU imports in 2023. With China’s
overcapacity and tariffs of 100% in the U.S. and Canada, the EU has become a critical market for
Chinese manufacturers. Following these findings and a 2023 anti-subsidy investigation that
determined China heavily subsidizes its electric vehicle (EV) exports, the EU imposed 35-45%
tariffs on Chinese EVs.
With the automotive industry contributing 6.1% of EU employment and over 7% of GDP, this
dialogue may be pivotal for shaping future policies. Expect a focus on lowering production and
consumer costs, fostering innovation in AI and EV technologies, and diversifying supply chains.
However, if Chinese EV imports exceed the current 8% market share, further tariff hikes could
follow—risking divisions within the EU over trade and industrial strategy.
