Key to Auto Industry: the Environment

Arnaud Montebourg, Productive Recovery Minister. Photo: Flickr.com/jyc1

Arnaud Montebourg, Productive Recovery Minister.
Photo: Flickr.com/jyc1

“This plan is the rebirth of the French car,” Arnaud Montebourg declared on Wednesday during a press conference held to detail the measures to help French manufacturers and their subcontractors.

Primarily focused on the environmentally friendly car, the Productive Recovery Minister explained that, “the future of the French automobile will come through a clean, innovative, and popular car.” He warned that, “we have to take advantage of the energy transition so that we can make an industrial reality from it.”

As a first measure, the government will strengthen the reward-penalty system for environmentally friendly and polluting cars that has been in place since 2008. The reward for electric cars will increase from €5,000 to €7,000, and from €2,000 to €4,000 for hybrids. To offset this increase, which will cost the government €490 million, polluting vehicles will be punished by a penalty that will be implemented in early 2013.

Arnaud Montebourg announced that another priority will be a more intense development of charging stations for electric vehicles. Twelve cities are candidates to be equipped with infrastructure to recharge batteries in public parking, for example.  In order to set an example, the government will replace 25% of its fleet (1,500 cars per year) with electric cars.

The Productive Recovery Minister calls for companies to clarify their intentions and redirect their investment to research and development. “We ask for the sustainability of sites,” he said, before demanding that laboratories for research and development “should be maintained on the national territory.” €350 million will be directed to innovation and €600 million could be released to help subcontractors, suppliers, and car dealers.

Montebourg denies that there is a protectionist aspect to these new regulations, as the measures are open to all manufacturers, but he nonetheless reaffirmed that “Europe must be open but cannot be offered up.” He hopes in the coming months to denounce “acts of unfair competition,” which, according to him, South Korean manufacturers are indulging in, following the signing of a free trade agreement between the EU and South Korea in 2010.

This plan for the future utilizing the strengths of the French automobile industry. Renault has made the leap to the electric car with its French-made car Zoe, as has PSA Peugeot-Citroën, that promotes the development of both diesel and hybrid vehicles. The Japanese automaker Toyota, which produces cars in France as well as a hybrid version of its Yaris, is a manufacturer that is currently a priority for the government.

Finally, to complete the plan and to highlight the “made in France,” aspect, the ads will even be made by French directors Luc Besson and Cedric Klapish.

Will these measures be enough to boost the French automobile industry? Just as the government had made their decision about these new measures, PSA announced losses of €819 million in the first half of 2012.

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  1. […] his government first defended the employees, one of the first concrete measures was to establish an automobile plan, which allowed more funds to factories and implicitly to employers without asking for any […]

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