The European Automobile Manufacturers’ Association (ACEA) has underscored the importance of swiftly ratifying the EU-Mercosur and EU-Mexico free-trade agreements to bolster the European automotive industry’s global competitiveness.
On 3 September, the European Commission (EC) submitted its proposals to the Council of the European Union to finalise these agreements.
The EU-Mercosur Partnership Agreement, involving Argentina, Brazil, Paraguay, and Uruguay, aims to create the “world’s largest free trade zone”, serving more than 700 million consumers.
It is expected to boost EU annual exports to Mercosur by up to 39%, or €49bn ($57bn), supporting more than 440,000 jobs across Europe.
According to the EC, EU businesses will gain a first-mover advantage with reduced tariffs in regions where other countries face high trade barriers.
The automotive industry body said the agreement will reinforce the EU automotive industry’s competitiveness amid growing global competition and supply chain challenges.
More than 30% of EU-produced vehicles are currently exported internationally, contributing to a €100bn trade surplus.
The Mercosur deal will remove tariffs of up to 35% on EU-made vehicles, potentially tripling automotive goods exports by 2040 and accessing a market of approximately three million vehicles.
The agreement will also enhance Europe’s economic resilience by diversifying supply chains for critical raw materials like lithium, graphite, and manganese, crucial for the green transition.
Similarly, modernising the EU-Mexico agreement will benefit the EU automotive sector by updating rules of origin and addressing technical trade barriers.
ACEA is urging EU policymakers to expedite the ratification of these agreements, highlighting their role as a strategic necessity for the automotive industry amidst intense competitive pressures.
ACEA Director General Sigrid de Vries said: “Free and fair global trade has underpinned the global success of a competitive European auto industry. Today, an open and rules-based trade system is more vital than ever, as we face an unprecedented storm of trade tensions, fiercer competition and a complex regulatory environment.”
“EU-Mercosur and Mexico trade deals crucial for auto industry: ACEA” was originally created and published by Motor Finance Online, a GlobalData owned brand.
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