By on June 6, 2012

Brussels has bad news for Fiat and PSA, and by extension for Chrysler and GM. There will be no EU assistance for an orchestrated  and painless capacity shedding, Financial Times Deutschland says.  A report of an expert group puts European overcapacities at 25 to 30 percent.  Fiat-Chrysler CEO Sergio Marchionne has been publicly lobbying for government support, PSA pressured the French government.  As predicted here months ago, a lobby of German carmakers torpedoed any support from Brussels and is for Darwinian solutions instead. With carmakers at odds, European governments are happy that they don’t have to act. After all, there are more pressing problems in Europe.

Instead of a massive support program, the EU likely will announce feel-good measures with the efficacy of a band-aid. There will be the usual green programs, combined with less aggressive CO2 limits. None of this will solve the overcapacities, which will get more pressing as Europeans get more cautious with buying new cars. Chrysler’s new owner Fiat, GM’s new partner PSA, along with Opel and to some degree Ford, will be sliding deeper and deeper into the European morass.


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10 Comments on “Shut Up And Die: No EU Life-Saver For European Car Industry...”

  • avatar

    Maybe they can work w/other countries to export some cars. God knows I would love an RS Clio

    • 0 avatar

      If safety standards were more alike across nations, that would be possible.

      There must be reasons for such differences, but I cannot imagine any that are legitimate.

      • 0 avatar

        Each nation enacts regulations based on its own needs, and on its own time table. If I recall correctly, the U.S. was ahead of Europe and Japan in adopting definite safety standards, just as we were ahead of them in adopting regulations covering emissions. Europe was still using leaded gasoline into the 1980s.

  • avatar
    schmitt trigger

    Signor Marchionne is becoming an expert in asking government bailout money….so don’t count him out. Not yet.

  • avatar

    “Shut up and Die” Isn’t that the meme of the Republican Health Care Plan?

    • 0 avatar
      doctor olds

      The unions in Europe had better come to the table with meaningful capacity/cost reductions or their industry will wither away,as did Great Britain’s decades ago. We will see whether the Euro unions have more clout than those in Wisconsin. They are too expensive to export, and the EU’s currency difficults show now signs of reaching a good resolution anytime soon, keeping the vehicle market depressed.

      @forraymond- US rear crash integrity requirements make the large opening hatchbacks popular in Europe very difficult here. These regulations forced the GTO to move the fuel tank, taking a big chunk of its trunk, for example.
      If you don’t like the “never enough” regulations on vehicles here, vote for the Republican’s. They are all for reigning in the out of control nanny state!

      • 0 avatar

        Not sure what the unions can do here. It’s not cost… it’s declining demand due to government overspending and banking fraud…. and oh yeah, Greece, Spain, Portugal, Italy and likely (gulp) France.

    • 0 avatar

      Taxpayers should therefore indefinitely prop up companies that are producing vehicles people don’t want in quantities sufficient to allow said company to consistently turn a profit? That doesn’t sound like much of a plan.

  • avatar
    Lynn E.

    “If you don’t like the “never enough” regulations on vehicles here, vote for the Republican’s. They are all for reigning in the out of control nanny state!”

    Absolutely, we rich 1% can buy safe cars, to hell with you poor 99%.

    But first we Republicans have to work with the Taliban to cover up women and take away their licenses to drive of course.

    Seriously, can the “government is always wrong” types explain why it is that we have higher speed limits and over 2x more cars on the road now than we did in the 50’s and yet the highway death rate is about the same or lower?

    Can the “governments of the world are always wrong” types ever understand that we now have about 8 billion people on earth and not 1, 2, or 3 billion and we have to make adjustments because there are so many of us? We just don’t have as much tolerance for empty/noisy/unsafe Dodge pick ups driven by pretend cowboys as we use to.

    • 0 avatar

      While you’re at it, perhaps the “more regulations are always good crowd” can explain why the fatality rate per 100 million vehicles fell the year after the national 55 and 65 mph speed limits were lifted, despite their hysterical predictions to the contrary.

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