91997E3707(01)

WRITTEN QUESTION E-3707/97

by Ulf Holm (V) to the Commission

(19 November 1997)

Subject: EU subsidies to the auto industry

According to the press, the EU is giving the car manufacturer, Jaguar, some one billion kronor in subsidies for the further development of a Jaguar model. The car will cost some one million kronor on the market. According to Commission President Santer's chief press officer, Colin Cook, the subsidy is to help them get a foothold in the segment currently occupied by the BMW 5-series. Jaguar cars are widely recognized as luxury vehicles with heavy fuel consumption.

1. To which other car manufacturers does the EU give financial support and how much?

2. Does the Commission consider it appropriate to subsidize the development of a luxury car that the absolute majority of EU citizens will never be able to buy?

3. Does the Commission consider that subsidies for the development of fuel-guzzling cars such as Jaguars can continue once the Amsterdam Treaty is in force in view of the fact that "sustainable development" is now written into the Treaty and will be a significant criterion in EU policy?

Supplementary answer

given by Mr Van Miert on behalf of the Commission

(18 September 1998)

This supplementary answer includes the information requested by the Honourable Member in point 1 of his question.

Under Community support framework II for Portugal for the period 1994-99, and more specifically the industry programme PEDIP II, a total of 97 individual projects in the automobile sector (classification codes 34100, 34200, 34300) are receiving public aid. The total volume of incentives approved until the end of November 1997 was ECU 310 million, of which ECU 235 million has been paid out. The European Regional Development Fund (ERDF) finances 75 % of the corresponding aid schemes.

Via the ERDF and under the 1994-99 industry programme for the Objective 1 regions in Italy, the Commission is also jointly financing the general aid scheme established by Law 488/92 for supporting productive investment in less favoured areas. In this context, five large projects (investments of more than ECU 15 million) for the automobile industry have been presented by the Italian authorities: three for Fiat Auto (investments amounting to ECU 635 million, with ECU 104 million to be provided by way of public assistance), one for Fiat Iveco (an investment of ECU 16 million, with ECU 4 million in public assistance) and one for Isotta Fraschini (an investment of ECU 20 million, with ECU 10 million in public assistance). These projects are currently being examined by the Commission.

Two firms have received aid from the ERDF in Spain: Fabrication des Automobiles Renault España SA and Suzuki Manufacturing Spain SA. According to the information transmitted by the Spanish authorities for the monitoring committee meeting of 14 July 1998, the amounts granted under the "Incentivos Regionales" operational programme between 1 January 1994 and 31 December 1997 were ESP 890 527 400 (around ECU 5,3 million) to Suzuki Ciudad Real, ESP 576 217 739 (around ECU 3,43 million) to Renault Sevilla and ESP 1 628 416 865 (around ECU 9,69 million) to Renault Valladolid.