European Automobile Manufacturers' Association Provides Comprehensive Recommendations for EU Regional EV Battery Sourcing Rate Legislation, Warns Against High Target Setting as "Not a Silver Bullet"

The European Automobile Manufacturers' Association (ACEA) published a recommendation paper on September 1 regarding legislation for local sourcing rates of electric vehicle (EV) batteries. This responds to the European Commission's proposal in the "Clean Industrial Deal" to introduce non-price criteria in public and private procurement to promote clean tech markets, and the policy shown in the March "Automotive Sector Industrial Action Plan" to establish regional sourcing rate regulations to expand battery production within the region. ACEA cautioned the European Commission that setting high regional sourcing rate targets is not a "silver bullet" for building regional value chains, emphasizing the need for comprehensive measures including energy price reduction, licensing efficiency improvements, and worker skill enhancement and retention. They stressed that without clarifying definitions, target products, and implementation start dates, supply chain uncertainty could arise.