Achi news desk-
(Bloomberg) — The French government will sign a wide-ranging agreement with the auto industry on Monday that sets new targets for sales of electric vehicles, just as Chinese President Xi Jinping arrives for a state visit clouded by trade tensions. in the sector.
The contract between the government, French business groups and unions aims for a fourfold increase in sales of 100% EVs to 800,000 per year in 2027. It also targets a sixfold increase for electric light commercial vehicles, to 100,000 per year .
Although no specific amount has been set for new subsidies, the government will repeat promises to continue supporting electric vehicle purchases and leases. The contract also has a chapter on “securing our sovereignty” which includes stress testing supply chains for essential materials.
The new “strategic sector contract” comes as France and other countries sound the alarm over the risk of overcapacity in China’s EV market drowning out their own domestic industries. In the fall, the European Commission acted on those concerns by launching an investigation into China’s support for its electric vehicle sector.
Read more: Macron Calls for Reset of Economic Ties with China
“The car industry is part of our industrial culture and this industry is facing a once in a century change,” said French Finance Minister Bruno Le Maire. “The transition is difficult, with strong competition from other countries, especially China. , so we need unity in the sector.”
The tensions between the EU and China over EVs will be a central part of Xi’s two-day visit to France, where he will also meet European Commission President Ursula von der Leyen. The tension has escalated into a wider spat, with Beijing launching a liquor dumping probe that could end up specifically harming French cognac makers.
France has taken its own steps by limiting cash support for EV purchases to vehicles with the lowest carbon footprint in production – a move that effectively excludes many Chinese-made models. It is also the first country to use new European rules to support the nascent battery industry with green tax credits.
Later on Monday, Le Maire will address the Franco-Chinese economic conference, where Xi and French President Emmanuel Macron are also expected to speak.
“Europe must adopt a trade policy that protects our industry, our jobs and our technology,” said Le Maire. “I decided to limit bonuses for electric vehicles to cars that respect the strictest environmental norms, simply to improve our productivity and face competition that is tougher and tougher, if not fierce.”
The broad agreement signed on Monday will also include a framework for cooperation on innovation, retraining, strengthening the sector’s supply chain in France, and increasing the network of recharging stations.
More stories like this are available on bloomberg.com
©2024 Bloomberg LP
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized news feed – it’s all here, just a click away! Login Now!
Catch all Business News, Market News, Breaking News Events and Latest News Updates about Live Mint. Download the Mint News App for Daily Market Updates.
More less
Published: 05 May 2024, 11:50 PM IST
