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A competitive automotive regulatory framework for the 21st Century

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A competitive automotive regulatory framework for the 21st Century

The strategy developed by the European Commission in response to the results of the CARS 21 High Level Group sets as its objective the sustainable development of the automotive industry. Boosting the sector's competitiveness on the world stage, through improving the regulatory environment and wider access to foreign markets, thus remains closely linked to progress made in the field of safety and environmental protection.


Communication from the Commission to the European Parliament and Council of 7 February 2007 - A competitive automotive regulatory framework for the 21st Century - Commission's position on the CARS 21 High Level Group Final Report [COM(2007) 22 final - Not published in the Official Journal].


The strategy for the sustainable development of the automotive industry strikes a balance between boosting the global competitiveness of the European automotive sector and making constant progress in the field of safety and environmental protection.

The challenges facing the automotive sector

The automotive industry accounts for 3% of European GDP and 7% of employment in the manufacturing sector, and is emerging as a key sector in the European economy.

More aggressive international competition, substantial fixed costs, particularly high prices for raw materials and energy, structural overcapacity, and the resulting restructuring and relocation are causes of concern for manufacturers, workers and consumers.

It is essential to create a framework for a competitive European automotive industry so that it can anticipate and rise to the challenges of competition by responding in a socially responsible and innovative way.

Strategy for the sustainable development of the automotive industry

The future course which the Commission intends to set for the automotive industry hinges on several key areas identified by the CARS 21 High Level Group report.

  • Internal market: EC type-approval system extended to all vehicles

Under the Community WVTA (Whole Vehicle Type-Approval) system, car manufacturers present a vehicle type to the authorities of a Member States to obtain its whole approval, attesting that it complies with Community technical requirements, and may thus market all vehicles of this type throughout the EU solely on the basis of their certificate of conformity.

This system, which was implemented for passenger cars, motorcycles and tractors, has proven to be effective and should not just be retained but extended to all categories of vehicles (commercial vehicles, trucks, coaches and buses) to smooth the operation of the internal market.

  • Regulatory environment: simplification and internationalisation

Thirty-eight Community directives will be replaced by the equivalent UN/ECE international regulations. Bringing car manufacturers under one single set of rules will help counter the negative effect of the cumulative cost of regulation on competitiveness which adds unnecessarily to the price of vehicles, without having any effect on the requirements concerning safety and environmental protection.

Self testing and virtual testing will also be introduced in a number of Community Directives and UN/ECE Regulations in order to reduce costs and speed up compliance procedures.

The European Union (EU) does, nevertheless, maintain the possibility to legislate independently from the UN/ECE system.

  • Environmental protection: sustainable road transport

Motor vehicles are responsible for a significant part of pollutant emissions in the EU. It is therefore vital that the automotive industry abide by the guidelines in the Thematic Strategy on Air Pollution. The main actions to reduce pollutant emissions from motor vehicles currently take the form of Euro 5 and 6 emission limits and the promotion of clean road transport vehicles by public procurement.

The integrated approach to reduce CO2 emissions is helping to achieve the Community objective of 120 g/km CO2 by 2012. If vehicle motor technology is to continue to improve in this direction, other technological improvements (air-conditioning systems, etc.) and the increased use of bio-fuels will also help reduce CO2 emissions.

Special attention should also be paid to the recycling of end-of-life vehicles and motor vehicle noise.

Aspects relating to energy, in terms both of cost and supply, are also likely to have an influence in the future on decisions concerning the shape and functioning of motor vehicles.

Member States will be involved in efforts to ensure sustainable road transport through better traffic management, more responsible driver behaviour or tax incentives.

  • Road safety: a joint effort

An effective road safety strategy should be based on the interaction between improvements in vehicle technology, road infrastructure, driver behaviour and enforcement of the legislation.

Measures such as improving the visibility of heavy-duty vehicles or introducing advanced safety technologies (intelligent vehicles) are already playing their part in achieving the European Commission's objective of a 50% reduction in the number of victims on European roads by 2010.

Further efforts are also still required in terms of electronic stability control systems, seat-belt reminders, the obligatory use of daytime running lights, and emergency braking systems.

  • Trade and overseas markets: fair global competition

The European automotive industry should be able to operate within a fair global business environment.

Whilst the global technical harmonisation of regulations relating to motor vehicles under the UN/ECE 1958 and 1998 agreements plays its part in this, particular attention also needs to be paid to improving market access by signing bilateral or regional trade agreements, especially with the countries of South-East Asia, and to enforcing intellectual property rules on a global scale.

  • Research and development: the key to competitiveness

The automotive sector, which was traditionally based on manufacturing industry, is increasingly knowledge-based and is now the largest industrial investor in R&D in Europe (ca. 5% of the sector's turnover).

It is crucial both for the competitiveness of the sector and the interests of safety and environmental protection that industrial research, technological development and demonstration be encouraged in strategic areas (intelligent vehicles, clean vehicles, second generation biofuels, hydrogen cells, fuel cells, etc.).

Support for research and development will be based in particular on the Seventh Framework Programme, but also on European financing institutions or public-private partnerships.

  • Internal market: taxation and competition

Progress also needs to be made on fiscal matters, particularly concerning passenger car related taxes and fiscal incentives, and in the field of competition in the aftermarket, so that independent repairers have access to the technical information required to repair and maintain vehicles.


The Commission strategy for the automotive sector is based on the results of the CARS 21 High Level Group, which was set up to develop a competitive regulatory system in the automotive sector for the 21st century. This High Level Group brought together the main stakeholders (representatives from the automotive sector, the Member States, Members of the European Parliament, NGOs, Commission) to discuss issues of vital importance to the future of the sector, and presented its recommendations in a road map at the end of 2005.

The Commission hopes that the exercise carried out for the automotive sector and the mid-term review scheduled for 2009 will, for example, contribute to the methodology for drawing up industrial policies.

See also

For further information, please consult the European Commission webpage on a competitive automotive regulatory framework for the 21st Century (CARS 21).

Last updated: 28.02.2007