Made in Europe: just a sticker or a real shield against China?

Europe's auto suppliers want a 70% local content threshold for Made in Europe vehicles; carmakers warn against rules that are too strict.

A new dispute over how to protect the auto industry is brewing in Europe. This time it is not about banning combustion engines or imposing tariffs, but about what can actually be called a Made in Europe car. In March, the European Commission proposed Local Content rules under the Industrial Accelerator Act.

The idea is straightforward: if Europe wants to keep its plants, suppliers and jobs, simply assembling cars on its territory is not enough. A meaningful share of the value has to be created inside the region rather than arriving as finished modules from China or other countries. The European Association of Automotive Suppliers CLEPA considers the draft too weak.

The group warns that without closing key loopholes, the Made in Europe label risks remaining a symbol rather than a real instrument of industrial policy. CLEPA is calling for a clear threshold: a car should qualify as European only if at least 70% of its added value is created in Europe.

Suppliers do not expect prices to spike sharply because of such requirements «at this stage». Their main worry is different — the loss of supply chains. According to CLEPA, up to 350,000 jobs could be at risk, especially as Chinese competitors rapidly scale up their technology, volumes and footprint in Europe. But carmakers are more cautious.

ACEA supports the idea of a strong European industry, but warns against overly rigid rules. ACEA Director General Sigrid de Vries argues that Made in Europe requirements alone will not fix the competitiveness problem. The main obstacles facing the European auto industry are bureaucracy, expensive energy and heavy regulation.

German groups have another reason to be cautious: China remains a vast market for them and a source of billions in revenue. Excessive protectionism could damage relationships they still heavily depend on. The result is a conflict inside a single industry.

Suppliers want tough protection because they are the first to feel the pressure of Chinese components. Carmakers fear that new barriers will make cars more expensive and complicate their global business. The buyer, meanwhile, will look at one simple thing: will the European car become more affordable and better — or will it just get another expensive sticker on its bodywork.

Earlier, Europe extends the life of petrol, but electric cars are still set to take off in 2026.