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James Dainty

European Automotive Facts and Myths – Post #2 of 6

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In this second article of our six part blog series, we explore the myth that European Government regulation has fatally wounded automotive manufacturers ability to generate vehicle profits.

#2 MYTH! Brussels has dealt a fatal blow to car manufacturing

The European automotive industry remains in fragile recovery as the region continues to recover from widespread recent recession. And yet Europe remains a bright crucible for the production of innovative new vehicles.

Brussels has not delivered a ‘fatal’ blow to the European car manufacturing industry.

An EU insistence of going beyond the current requirements of fuel consumption of 130 grammes per kilometre to 95g/km by 2020 is a tough call, especially in light of the fact that Europe already has stricter and higher fuel consumption regulations when compared to other regions. Many European automotive manufacturers are very concerned. Volkswagen CEO Martin Winterkorn even went so far as to state recently that tighter regulations and the associated costs will prove “fatal” to the European car industry.

But while regional pressures can be argued to be unfair, the European car industry has always been innovative, and this innovation has been a strong source of competitive advantage for the region’s manufacturers. Regulation enforced adoption will undoubtedly result in more fuel-economic vehicles, evolved hybrids and electronic vehicles, as well as the light weighting of vehicles.

While Brussels may be presenting new costs and challenges in the short-term, it might also deliver an opportunity for Europe maintain a competitive edge and to lead a global trend long-term.

Want to learn more?

Download the whitepaper, How Automotive Manufacturers Can Navigate the Cost of Increased Government Regulation, to learn more about these issues, and about new strategies that can help automotive manufacturers navigate the cost impact of these requirements across the entire product development process. This whitepaper also presents ways to identify new cost savings on individual parts and products as well as entire product assemblies and platforms to offset the increased costs of new regulations.

 

Other posts in the European Automotive Facts and Myths series

FACT!  Manufacturers must produce more efficient cars

FACT!  Every gramme of carbon dioxide manufacturers eliminate costs 100 million Euros

MYTH!  The current automotive product development and costing process is efficient

FACT!  The automotive industry is slow to adopt new technologies

MYTH!  New technologies are powerless to help manufacturers improve costing systems

 

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