Hungarian Presidency: ‘Ensure subsidies for electric cars’

Brussels – Electric car ‘yes,’ but only if the EU opens the door to subsidies. The Hungarian presidency on duty wastes no time and begins to re-discuss the Green Deal in one of its key components, the car. From 2035, it will no longer be possible to produce four-wheelers powered by traditional engines, and electrics, in the new course, will play an important role. Provided it is willing to play it. “If we still want to be committed to the 2035 targets, we have to provide subsidies and determine how to guarantee them,” Marton Nagy, Minister for Economic Development of the Hungarian government, sounded out at the press conference of the informal Competitiveness Council meeting.

The European Commission has the task of reasoning on how to raise the money. Hungary suggests considering the funds so far allocated to the regions. “The new cohesion policy could be used to finance” interventions along these lines. Whatever the choice, according to the Hungarian Minister, there is no doubt that industry needs support when it comes to electric vehicles. “Without subsidies, you don’t accelerate production,” Nagy continued. “Without subsidies, manufacturers have no choice but to reduce costs” of production, “and battery manufacturers will also have to reduce costs.” In essence, it stops the construction of the electric car. To avoid this and meet the commitments the EU has given itself, not without controversy and discontent, “we need common rules on state aid for the automotive sector.”

At the same time, trade wars and protectionist impulses should be avoided. Pressed by reporters, Nagy said he was against the European Commission’s choice of imposing duties on Chinese electric cars. “Hungary is very much opposed. We believe competitiveness requires competition, and protectionism is not the answer.” So, there is a divergence of views between the rotating Presidency of the EU Council and the EU Commission on clean and sustainable mobility and the industrial policy to achieve them.