Technology German car manufacturers and unions demand more government help...

German car manufacturers and unions demand more government help for electricity change

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BERLIN (Reuters) – German automakers and unions urged the government on Thursday to do more to support the industry’s change to electric cars, which provide less assembly work than combustion engine vehicles.

State-backed employment plans should support retraining and short-term work hours should be exempt from social security contributions, according to a proposal published by the German Employers Association Gesamtmetall.

An umbrella fund should also be established to help companies with the cost of the review. Interested parties would pay the fund, according to the proposal, without giving details.

The plan was discussed at a summit attended by the German IG Metall union and automotive industry bosses in Berlin on Wednesday.

“Even if there is no economic recession or crisis, a coordinated approach between the social partners and the state is required to strengthen Germany as an industrial location and offer employees a perspective,” Gesamtmetall said in a statement.

Electric cars have fewer moving parts than combustion engine variants, which puts at risk around 410,000 German jobs by 2030, according to a study published by the German National Mobility Future Platform this week.

IG Metall chief Joerg Hofmann said the government had pledged to address the issue urgently.

The government will discuss how to loosen employment rules to facilitate short-term work hours and a decision could be reached before January 29, sources familiar with the discussions told Reuters.

The auto industry is struggling to adapt to stricter anti-pollution standards that hardened dramatically after Volkswagen (VOWG_p.DE) admitted in 2015 to systematically cheat on exhaust emission tests.

In September, the European Parliament’s environmental commission voted to reduce carbon dioxide emissions from vehicles by 45% between 2021 and 2030, and pressed for a 20% share of electric vehicles by 2025 and 50% by 2030

Meeting even the previous objectives for = 2021 will be a challenge, said consulting firm PA consulting.

It was predicted in a study this week that the 13 leading manufacturers in Europe face combined fines of more than 14.5 billion euros ($ 16.2 billion) for missing the 2021 goals.

PA Consulting estimates are based on buyer choices in 2018. Since then, car manufacturers have launched a series of hybrid and electric cars, but have moved away from diesel vehicles that emit less CO2 and the increasing popularity of Heavy sport utility vehicles have made it more difficult to achieve.

Volkswagen could face a fine of 4,500 million euros, Fiat Chrysler a fine of 2,460 million euros and fines of Peugeot and Daimler of 938 million and 997 million respectively, estimated PA Consulting.

Car manufacturers will need to sell more than 2.5 million electric cars to meet the 2021 goals, an increase of 1,280%, he added.

Reports of Holger Hansen in Berlin and Edward Taylor in Frankfurt; Edition by Mark Potter

Our Standards:The principles of trust of Thomson Reuters.

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