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Jobs Would Be At Threat By Europe's CO2 Cuts: Chief Of French Carmaker PSA

Jobs Would Be At Threat By Europe's CO2 Cuts: Chief Of French Carmaker PSA
There can be a threat to 13 million jobs in the auto sector in Europe because of the plans of the European Union to further cut down the threshold of the carbon dioxide (CO2) emissions from vehicles and to force auto makers to fast shift to making more of electric cars. This warning was issued by the head of French car maker PSA in an interview to Le Figaro, who also added that this loss of jobs would ultimately benefit Asian auto makers and auto factories in Asia.
In December, the European Parliament and EU member countries struck an agreement to bring down the permissible emissions from cars from  37.5 per cent by 2030 in comparison to levels in 2021 and to cut down emission from vans by 31 per cent during the same period.
"This jeopardises the jobs of 13 million people in the industry and could destabilise some of our European societies," PSA's CEO Carlos Tavares. He also leads the European Automobile Manufacturers' Association (ACEA), and the comments were made in an interview with Le Figaro newspaper published recently.
The construction of new battery factories and the efforts of France and Germany to thus provide a boost to the electric car battery industry of Europe were also lauded by Tavares who claimed that this would reduce the dependence of European electric car makers on batteries delivered by Asian rivals.
But he also added that the project has been considered to be unprofitable by some of the big players in Europe including Bosch after they had studied the project in detail. He also added that the project had also been investigated by the PSA which had found that the initial capital costs for the project were very large and under the current regulatory environment of the European Union, it would be difficult for the battery industry to localize the production process.

"If European carmakers do not sell enough electric vehicles by 2020, 2025 and 2030, they will be ruined by fines. This forces us to reserve significant volumes of batteries with Asian suppliers, who are awaiting us with a big smile," he said.
Analysts and even company investors and insiders were of the view that the last hope for the company was the Chinese market or so he was told when he arrived at PSA in 2013, Tavares said. However since then, the company has been able to generate about 80 per cent of its total sale in Europe.
Tavares said that the Chinese market has been a rather difficult one for the PSA and added that the company is still trying to gain an appropriate understanding of the market to adjust its business strategies. The company is yet to completely understand the expectations of the customers and the manner in which its state owned partners thought about business and joint ventures. 

"The decision mechanisms in our joint ventures are intolerably slow," he said.

Christopher J. Mitchell

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