France boosts electric vehicle ambitions as Chinese president arrives in Paris

An agreement between the government, French trade groups and unions aims to quadruple sales of 100% EVs to 800,000 a year in 2027. It also targets a six-fold increase to 100,000 annually for electric light commercial vehicles.

While no specific amount has been specified for the new subsidy, the government will reiterate promises to continue support for EV purchases and leases. The agreement also has a chapter on “Asserting our sovereignty” which includes stress testing supply chains for critical materials.

The new “strategic sector agreement” comes as France and other countries sounded the alarm over the dangers of China’s EV market engulfing their own domestic industries. In the fall, the European Commission acted on those concerns by launching an investigation into China. Support for its EV sector.

“The auto industry is part of our industrial culture and the industry is facing a once-in-a-century transformation,” said French Finance Minister Bruno Le Maire. “With strong competition from other countries, especially China, the transition is difficult. , so we need unity in the sector.”

EU-China tensions over EVs will be front and center during Xi’s two-day visit to France, where he will also meet with European Commission President Ursula von der Leyen. Tensions have escalated into a wider dispute, with Beijing launching an investigation into alcohol dumping that could ultimately hurt French cognac producers in particular.

France has taken its own course of action by restricting cash support for EV purchases to vehicles with the lowest carbon footprint in production — a move that effectively excludes many Chinese-made models. It is also the first country to use new European rules to support the nascent battery industry with green tax credits.

Later on Monday, Le Maire will address the Franco-China Economic Conference, where Xi and French President Emmanuel Macron are also scheduled to speak.

“Europe must adopt a trade policy that protects our industry, our jobs and our technology.” Le Maire said. “I decided to limit the bonus for EVs to cars that respect the environmental standards very simply, to increase our production and to face the competition. Harder and tougher, if not ferocious.”

The wide-ranging agreement signed on Monday will include a framework for cooperation on innovation, retraining, strengthening the sector’s supply chain in France and increasing the network of recharging stations.

Date of first publication: 06 May 2024, 08:20 AM IST