EU plan to reduce steel quotas threatens European automotive industry – ACEA

The European Automobile Manufacturers’ Association (ACEA) has criticized the European Commission’s new plan to sharply reduce steel import quotas. According to automakers, these measures could have a negative impact on the industry’s competitiveness as they will lead to higher costs and create additional administrative barriers, Reuters reports.

ACEA estimates that European automakers purchase about 90% of the steel they need directly from within the EU. However, the industry still depends on imports of certain grades and types of metal, especially specialized automotive grades, which are quickly exhausted under the current quota system. The association believes that the new restrictions will only exacerbate this problem.

The European Commission has proposed cutting duty-free steel import quotas by almost half and doubling the duty on supplies above the quota to 50%. The aim of the move is to preserve the viability of EU steelmakers, which face competition from cheaper imports. At the same time, the proposal still has to be approved by the governments of the member states and the European Parliament.

“We do not deny the need for a certain level of protection for such a basic industry as steelmaking. But the parameters proposed by the Commission are too restrictive for the European market,” said ACEA Director General Sigrid de Vries.

Among the most problematic aspects, automakers cite the new requirement for importers to identify where the primary steel was smelted and cast. In the complex global supply chains of the automotive industry, it will be extremely difficult to comply with this regulation.

“A better balance needs to be found between the interests of European steel producers and consumers of this material,” ACEA concluded.

As a reminder, on October 7, the EC presented a proposal to protect the EU steel industry from the unfair impact of global overcapacity. In particular, the commission proposes to limit duty-free imports to 18.3 million tons per year, which is a 47% reduction compared to the 2024 steel quotas, to double duties on products outside the quota to 50%, and to strengthen the traceability of steel markets by introducing melting and casting requirements to prevent circumvention.