France and Germany agree UK can join EU's Made in Europe scheme

Summarised from 5 outlets · 7 reports · Updated 16 Oct, 08:44 · Archive

France and Germany have agreed to include the UK in the EU's Made in Europe legislation, marking a significant shift in French policy. Germany had consistently supported the UK's inclusion, but France had previously opposed it. The agreement came through on Thursday as part of a broader deal on automotive industry policy.

The UK's inclusion would apply specifically to the car industry within the Industrial Accelerator Act (IAA), the draft legislation designed to protect domestic manufacturing from cheap Chinese competition. The UK would be designated as European for the purposes of public procurement and subsidy schemes, as it was part of the EU single market as of 1 January 2020. Norway would also qualify under similar terms.

However, the UK's participation comes with conditions. The British government must adopt full reciprocity with the EU, including alignment on trade defence measures. This encompasses the tariffs on Chinese electric vehicles imposed by the EU in 2024 and any future trade barriers, such as quota deals being negotiated with China on hybrid car exports. The Politico report indicates that the deal also involves Germany accepting stricter Made in Europe criteria for the automotive sector in exchange for greater flexibility on combustion engine regulations beyond 2035.

Mercedes-Benz boss Ola Källenius, speaking as president of the European Automobile Manufacturers' Association, had warned that locking the UK out would "hurt" the car industry across the bloc and "weaken the industry on both sides". Andy Burnham had been actively lobbying for British inclusion in the legislation.

The France 24 and Politico reports note that the broader deal also addresses EU emissions rules for carmakers, though outlets differ on the status: France 24 reports the deal was reached on Thursday, whilst Politico indicates the agreement stalled on Thursday evening after objections from Germany's SPD coalition partner, who feared important environmental targets had been compromised. Politico reports that a final agreement remained pending.

How it is being reported

• Merz und Macron bestätigen Einigung zum Verbrenner-Aus und „Made in Europe“Zunächst hatte Carsten Schneider die Einigung blockiert. Am Freitag gab der Umweltminister sein Ok zu dem Papier.Politico Europe · 16 Oct, 11:41
• Germany, France agree deal to support European car industryThe two countries said the agreement aimed to safeguard Europe's automative industry, encouraging development and research. Car makers in Europe have so far struggled to compete with Chinese electric car companies.DW News · 16 Oct, 11:32
• UK and EU to 'work together and act in lockstep' amid Chinese tariff debate, minister saysThe UK could adopt European Union policies and impose hefty tariffs on Chinese car brands importing hybrid and electric vehicles, a Government minister has suggested. Speaking at the German-British Business Summit at Mansion House, Trade Minister Anas Sarwar said the UK and EU need to "work together and act in lockstep". Speaking to Politico, the former Leader of the Scottish Labour Party said the Government remained in conversation with European partners on the prospect of tariffs on Chinese cars. Chinese cars have seen massive success over the last three years in the UK as drivers look to…GB News · 16 Oct, 10:50
• Deutsch-Französische Einigung zu „Made in Europe“ und Autoabgasen verzögert sich – SPD erhebt EinwändeDer Vertragsentwurf sieht strengere Zulassungsbedingungen für Nicht-EU-Länder hinsichtlich der Teilnahme an öffentlichen Ausschreibungen und der Inanspruchnahme öffentlicher Fördermittel vor und mildert das Verbot von Verbrennungsmotoren ab dem Jahr 2035 ab.Politico Europe · 16 Oct, 08:35
• France and Germany agree to ease EU car emissions rules in new dealFrance and Germany have backed looser EU emissions rules for carmakers and agreed to include Britain in a “made in Europe” scheme, in a provisional deal reached Thursday that could reshape the bloc’s automotive and climate policies.France 24 · 16 Oct, 00:48
• France drops opposition to UK being included in ‘Made in Europe’ legislationBritish government must however align with the European Union’s position over tariffs on Chinese EVs France has dropped its opposition to the UK being included in the EU’s “Made in Europe” legislation as long as the British government aligns with the bloc’s position over tariffs on Chinese EVs. France on Thursday came round to backing Germany, which has always supported the UK’s calls to be designated European for the purposes of the Industrial Accelerator Act. The legislation, which is in its draft stage, is designed to protect domestic manufacturing from cheap Chinese competition. Continue…The Guardian · 15 Oct, 20:28
• Locking UK out of ‘Made in Europe’ law will ‘hurt’ carmaking across EU, says Mercedes-Benz bossOla Källenius says it will ‘weaken the industry on both sides’ ahead of act intended to counter non-EU competition Locking the UK out of the EU’s flagship industrial “Made in Europe” legislation would amount to a “deliberate choice” by EU leaders to “hurt” the car industry across the bloc, the head of Mercedes-Benz has said. Speaking in his capacity as president of the European Automobile Manufacturers’ Association (ACEA), Ola Källenius said such a move would “weaken the industry on both sides”. Continue reading...The Guardian · 14 Oct, 14:26

In this story: UK · France · Germany · EU · Mercedes-Benz · Ola Källenius · Andy Burnham

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