France and Germany Reach Compromise on 'Made In EU' Regulation for UK

In the 'Made in EU' regulation prepared by the European Union to protect the automotive industry, France and Germany reached a consensus on a joint proposal paving the way for a special status for the UK, while Turkey was not included in this special scope.

France and Germany have reached a consensus on a joint proposal envisaging special status for the UK under the EU's 'Made in EU' regulation, on which they had long advocated differing views. Following the agreement, French President Emmanuel Macron stated that they want the electric cars of the future to be produced in France and Europe. This approach also aligned with the views of Stellantis CEO Antonio Filosa, who argued at the Paris Motor Show that the regulation should support companies that carry out R&D, design, engineering, and manufacturing in Europe alongside assembly.

Germany had previously advocated a broader 'Made with Europe' approach encompassing countries integrated into the European production chain, such as Turkey. However, with the compromise between the two countries, the door was opened for the UK on condition that it complies with the EU's trade measures against Chinese electric vehicles, whereas a similar exception was not envisaged for Turkey.

The new regulation, which will determine the conditions for support to be provided to production and investments in Europe, has not yet been adopted across the EU, and negotiations will determine its final form. While this development carries the risk of affecting not only automotive exports but also future new model and factory investments for Turkey, the compromise between the two countries points to a new era that will test Turkey's bargaining power.