European Automaker Supplier Chief Advocates for Local Content Rule in European Car Production
The head of the French auto supplier Valeo, Christophe Périllat, has called for a “local content clause” in European car production. According to Périllat, Europe should welcome the competition from Chinese automakers and suppliers, as long as the cars are assembled in Europe with European components.
Périllat pointed out that other countries have already implemented such regulations, citing the 75 percent local content requirement in North America, 80 percent in India and the Chinese government generating the full value of a car in the country. The French government is strongly supporting this demand, he said.
At the European Commission, Périllat believes a change of heart is needed to adopt a similar rule. “I think Germany will move on this issue” he said.
Périllat argued that a 35 percent competitiveness gap exists between Europe and China, which cannot be bridged solely through cost reductions and reforms in the EU. He emphasized that even if Chinese automakers come to Europe, the competition problem will not be solved, as 75 percent of a car’s value comes from suppliers.
Périllat also rejected the EU Commission’s tariffs on Chinese electric cars as a solution, saying that a local content clause is the more effective way to address the issue.