Author:
ROBIN ROBERTS
Major European car makers will meet today to discuss tackling over-capacity of manufacturing across the region.
Fiat-Chrysler CEO Sergio Marchionne heads the European carmaker group ACEA and has called for the EU to lead a coordinated cross-border effort to close plants.
He notes that individual countries are blocking moves to shutter facilities to protect local jobs, thus resulting in 20% more plant capacity in Europe than the industry needs.
Executives from Daimler, Ford, PSA Peugeot Citroen and Renault are scheduled to meet with Industry Commissioner Antonio Tajani today amid concerns over individual countries pressurising the companies not to close or cut back production in their ‘home’ countries.
The European Commission won’t take on the politically sensitive task of guiding the auto industry’s effort to reduce overcapacity. Industry Commission Antonio Tajani says that policy to shrink capacity is the job of individual countries.
He notes that excess capacity is mainly a problem for Italian and French carmakers and does not affect German counterparts, which have been buoyed by booming business to the US. Tajani says the EC could help carmakers restructure with financing for such projects as worker retraining and technical innovation.
Fiat is reported to be considering a cut back on plans to launch the new Bravo and Grande Punto until at least 2014 amid concerns over the economy and rising costs. Mazda has also announced plans to cut European jobs after a 14pc slide in local sales and even India is seeing a slowdown in its growth after 9 years of climbing.
French car sales have collapsed 17pc and Germany has also seen a 5pc drop.
Manufacturers worldwide are setting their eyes on the US to drive growth.
According to KPMG’s 2012 Global Manufacturing Outlook: Fostering Growth through Innovation, 40 percent of the global manufacturing leaders believe that the US will account for the majority of sales and profits growth for manufacturers over the next two years, followed by China, India, Brazil and Germany.
Sales of business cars bucking the trend and keeping the premium manufacturers going and you can keep up to date with developments in our business car news section and you’ll find our independent company car comparisons worth considering.
