Europe’s largest carmakers Volkswagen and Stellantis have called for subsidies to keep carmaking in the EU as they struggle with challenges from US tariffs to Chinese competition, in an article published Thursday.
Electric cars largely made within the bloc should benefit from subsidies for buyers, orders from government as well as a “CO2 bonus” paid directly to carmakers, VW boss Oliver Blume and Stellantis chief Antonio Filosa said.
“European taxpayers’ money should be carefully deployed to promote European production and bring investment into the EU,” they wrote in a piece published in European media including French business newspaper Les Echos and German daily Handelsblatt.
“In a world where others proudly defend their industries, Europe must urgently decide whether it wants to become merely a market for others or remain a producer and industrial power in the future,” they added.
Europe’s automakers are struggling on multiple fronts, afflicted by tariffs imposed by US President Donald Trump as well as Chinese dominance of the supply chain for electric vehicles, including batteries and rare earths.
Chinese titans like BYD that have already eaten into market share of foreign carmakers in China are meanwhile establishing a foothold in Europe, leading to fears that the continent’s carmakers’ home-market could be in peril.
“Our companies have always built cars by Europeans for Europeans,” Blume and Filosa, who heads the Jeep-maker said, adding that their business model nevertheless faced “competition from importers operating under less demanding regulatory and social conditions than those in the EU.”
The EU has since 2024 levied higher tariffs on Chinese-made electric cars, alleging they benefit from unfair state subsidies.
But a “‘Made in Europe’ strategy” encompassing support for continental carmakers is necessary, Blume and Filosa said, since it is hard to sell competitively priced electric cars without relying on Chinese inputs.
“Our European customers rightly expect us to offer electric vehicles that are as affordable as possible,” they said.
“But the lower the price of a car, the greater the pressure to import the cheapest available batteries for it.”
