What the Made in Europe rules would do

Volkswagen's chief has thrown his weight behind a plan to strengthen European manufacturing. The 'Made in Europe' rules are formally known as the Industrial Accelerator Act. Under the proposals, subsidies and public procurement would be limited to products with a large proportion of materials and manufacturing from within the EU. The stated aim is countering the rapid rise of Chinese brands in Europe, both in the automotive sector and in other manufacturing industries.

Blume's case for comparable conditions

Speaking in Paris before the motor show this week, Blume said the rules must reward real value creation in Europe. "Europe is under enormous competitive pressure", he said, pointing to high energy costs, weaker demand amid high inflation, the need to develop cars faster and intense competition from China.

His demands came down to a handful of principles:

• •Companies that invest and develop in Europe must see a clear benefit.
• •Those who sell here should compete under comparable conditions, and also create jobs and value in Europe.
• •Openness means standing up for Europe's own interests, because a strong industrial base protects technological independence.

Volkswagen's own transformation

Blume has called the company's current restructuring the largest transformation programme in its history, with plans to cut as many as 100,000 jobs. CFO Arno Antlitz has argued the cuts are necessary to increase economic power by raising profitability and defending the home turf. The model range worldwide, across brands including Audi and Škoda, is being cut from 150 to 75 to reduce complexity and per-vehicle costs. On Sunday, Volkswagen revealed the production version of its ID Tiguan, an electric edition of its bestselling family SUV.

Paris setting and EU-China talks

Volkswagen is exhibiting at the Paris motor show for the first time in 20 years, and is hosting French industry minister Sébastian Martin. Blume also emphasised the close ties between France and Germany. On Friday, the EU said it had reached a landmark deal with China to halve its sales of hybrid cars in the bloc.