Press release

19 Nov 2020 London, GB

German government pledges EUR 5bn to support its automotive sector transformation: David Borland, EY’s UK Automotive Leader, comments on significance for UK sector

Following on from yesterday’s announcement from the UK government that new petrol and diesel and car sales will be banned from 2030, the German government has pledged EUR 5bn to support its automotive sector transformation.

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Adam Holden

Senior Manager, Media Relations, Ernst & Young LLP

Passionate media relations and public relations professional helping to provide insight and clarity to complex business issues. Husband and father to twin boys, and a golden retriever.

Related topics Automotive

“Following on from the UK government's announcement that new petrol and diesel car sales will be banned from 2030, the German government has pledged EUR 5bn to support its automotive sector transformation.

“This announcement is significant, not only for the financial support provided, but also the recognition that the transformation of the automotive sector value chain, across the globe, will be complex, challenging and cash intensive.

“Relative to the UK announcement, the areas we believe will be key to a successful transition to Battery Electric Vehicles (BEVs) are:

“Product availability, this is where the OEMs and suppliers’ role is crucial and requires a continued focus on bringing new products to market, at the right price point, in line with the development and reduction of new technology costs. The emerging supply chain for new technology and the location will be a critical influence to the future manufacturing footprint for the industry.

“Deploying a charging infrastructure, that supports the adoption of BEV and leverages new sources of green energy.

“For customers, having a simple and effective message on the benefits of ownership, both in terms of the environmental impact and costs. Part of this is understanding that battery vehicles may have zero tailpipe emissions, but there is a wider impact to the new supply chain for batteries that needs to be considered. The transition of corporate vehicle fleets will need to be supported as well as retail customers, and understanding they have different needs and will adopt at different rates.

“Continued development of policy and regulation - This includes the appropriate incentives and robust policy & regulation to ensure the transition to BEVs is as smooth and effective as possible. Implementation of the EU CO2 emissions targets will help drive the products to market and the incentives will enable consumers to mitigate the higher purchase price of the vehicles.

“Finally, this will require significant capital investment from public and private funds with the need for multiple stakeholder groups to come together and collaborate as never before.”