The Truth About Cars » Brussels http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Thu, 04 Dec 2014 19:13:59 +0000 en-US hourly 1 http://wordpress.org/?v=4.0.1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars editors@ttac.com editors@ttac.com (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » Brussels http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com Le Bailout: Brussels Objects To France’s Lifeline For PSA http://www.thetruthaboutcars.com/2012/12/le-bailout-brussels-objects-to-frances-lifeline-for-psa/ http://www.thetruthaboutcars.com/2012/12/le-bailout-brussels-objects-to-frances-lifeline-for-psa/#comments Fri, 21 Dec 2012 15:15:27 +0000 http://www.thetruthaboutcars.com/?p=471344 We did not believe that EU regulators would let France’s government bailout of GM’s alliance partner PSA skate through unchallenged. State aid to companies is against EU rules, and refinancing of Banque PSA Finance is state aid EU Competition Commissioner Joaquin Almunia wrote in a letter to the French government. This according to a report in the French daily […]

The post Le Bailout: Brussels Objects To France’s Lifeline For PSA appeared first on The Truth About Cars.

]]>

We did not believe that EU regulators would let France’s government bailout of GM’s alliance partner PSA skate through unchallenged. State aid to companies is against EU rules, and refinancing of Banque PSA Finance is state aid EU Competition Commissioner Joaquin Almunia wrote in a letter to the French government. This according to a report in the French daily Les Echos.

The clever French thought that by propping up PSA’s bank instead of PSA directly, the aid would be legal. EU governments may help banks, but not other companies. The EU competition commissioner does not quite buy this argument.

The EU stumbled over the hard to miss fact that the aid comes with strong strings attached: Reduced job cuts, French plants stay open, government and worker representatives get a seat on the board of PSA. A bank does not commit to car plants remaining in the country.

“The EU objections follow a formal complaint received by Brussels from an unidentified Peugeot competitor,” says Reuters.  The German state of Lower Saxony said it would report the deal to Brussels as a possible breach of EU rules. Lower Saxony is a shareholder of Volkswagen, which is headquartered in the state.

France is a repeat offender. In 2010, Almunia objected to a government loan to Renault, There was a clause in the agreement that required that within two years, Renault has to buy 70 percent of the parts from French suppliers. In 2009, the French government tried to link loans for PSA and Renault with keeping jobs in France. Brussels showed the yellow card, and Nicolas Sarkozy watered the clause down to a “moral obligation.”

However, using Brussels as the bogeyman is part of the Europe political theater. Act 1: Government comes to the rescue to save jobs. Act 2: Brussels objects. Act 3: Government says: “We tried.” Act 4: Government saves face and money.

The post Le Bailout: Brussels Objects To France’s Lifeline For PSA appeared first on The Truth About Cars.

]]>
http://www.thetruthaboutcars.com/2012/12/le-bailout-brussels-objects-to-frances-lifeline-for-psa/feed/ 1
Brussels Has Issues With Government Loan To Renault. A Lecture For Opel? http://www.thetruthaboutcars.com/2010/05/brussels-has-issues-with-government-loan-to-renault-a-lecture-for-opel/ http://www.thetruthaboutcars.com/2010/05/brussels-has-issues-with-government-loan-to-renault-a-lecture-for-opel/#comments Thu, 06 May 2010 15:47:03 +0000 http://www.thetruthaboutcars.com/?p=355553 It’s tough to be a European car maker with a governmental sugar daddy. First you have to make nice with your sugar daddy, and commit unspeakable acts until he shakes loose a few hundred million Euro. Then, the prudes from Brussels shoot the stipend down. Your sugar daddy can say: “Darling, I tried.” He then […]

The post Brussels Has Issues With Government Loan To Renault. A Lecture For Opel? appeared first on The Truth About Cars.

]]>

It’s tough to be a European car maker with a governmental sugar daddy. First you have to make nice with your sugar daddy, and commit unspeakable acts until he shakes loose a few hundred million Euro. Then, the prudes from Brussels shoot the stipend down. Your sugar daddy can say: “Darling, I tried.” He then can go on with the business of bailing out Mediterranean states. So it happened with Renault. So it might happen with Opel.

Renault, 15 percent owned by the French government, received a €100m loan from their governmental shareholder. Supposedly for a good cause: The production of electric cars.

After a careful inspection of the note, the protectors of fair competition in Brussels found what they were looking for: A clause that requires that within two years, Renault has to buy 70 percent of the parts from French suppliers.

“Aha!” said Joaquin Almunia, EU competition commissar in Brussels, and sent a strongly worded note to Paris. Such clauses collide with EU rules, reminds us Das Autohaus. But why should the French help a French company, if the money goes to a parts maker in Slovenia?

“Rules are rules,” says Almunia, and he will “closely monitor” whether the rules are adhered to.

France is a repeat offender. 2009, the French government tried to link loans for PSA and Renault with keeping jobs in France. Brussels showed the yellow card, and Nicolas Sarkozy watered the clause down to a “moral obligation.”

And why are we going through the arcana of EU rules? Just imagine what happens if and when Opel should get bailed out. Every country will carefully write a “keep the jobs at home clause into the loan agreement, as it already happened in the UK.

Then, Brussels will shoot it down. All European sugar daddies will say “we tried our best, darling.” Then, they will turn their attention to more pressing problems.

The post Brussels Has Issues With Government Loan To Renault. A Lecture For Opel? appeared first on The Truth About Cars.

]]>
http://www.thetruthaboutcars.com/2010/05/brussels-has-issues-with-government-loan-to-renault-a-lecture-for-opel/feed/ 6