EU auto quota plan draws concern over Türkiye-EU supply chains

Leading European auto firms Volkswagen, Renault and Stellantis urged the EU to implement new "Made in Europe" criteria requiring at least 70% of a vehicle's value to be generated within member states in a bid to shield the industrial base from global pressures, but the initiative risks harming both Turkish and European manufacturers, a sector representative warned.

Mehmet Ali Yalcindag, coordinating chair of the Foreign Economic Relations Board (DEIK), told Anadolu that a 30-year Customs Union has made Türkiye an indispensable part of Europe's auto supply and value chains, so classifying the country as a third country relegated to the remaining 30% quota would disrupt already established business plans and reduce regional production capacity.

Yalcindag stated that half of all buses operating on European roads are made in Türkiye, so including Türkiye within the new "Made in Europe" origin scheme would allow the bloc to preserve lower-cost, high-quality production hubs, leading to a win-win scenario.

"There are significant cooperation opportunities between Türkiye and Europe, not only in the automotive sector but also in energy, defense, supply chains, digitalization and the green transition sectors — for this reason, rather than discussing and objecting to steps that would lead to a reversal of progress in areas where we have already made headway, we need to protect our existing gains and build upon them," he said.

"We will not welcome any alternative proposals from the EU that exclude Türkiye, and we will continue our lobbying on every platform with EU countries in this regard," he added.

The push by European automakers came as the European Commission is working on new industrial incentives and localization mechanisms under its "Industrial Accelerator Act."

The three automakers, which together make up over 60% of EU vehicle production, claimed the European auto industry is under global competitive pressure and new incentives are needed, according to a joint letter to the European Parliament and EU institutions.

The letter stated that applying a "Made in Europe" label on vehicles sold in Europe needs to be based on common rules across the bloc, such as a vehicle's development in Europe and engineering and production being conducted within the EU, and must be included in calculating the domestic-to-foreign content ratio in a vehicle.