Merkel to discuss future with representatives of Germany’s struggling auto sector

Chancellor Angela Merkel is to discuss the future of Germany’s key automotive sector with industry representatives on Tuesday, at a time of crisis caused by the coronavirus pandemic.

The video conference is scheduled to take place from 7-9 pm (1700-1900 GMT).

Merkel has been holding regular talks with carmakers since late 2019 as part of her government’s focus on the development of digital technologies that allow automated and connected driving.

But those political ambitions for sustainable and high-tech car manufacturing have come up against a harsh economic reality for the sector, which was dealt a severe blow by lockdown measures earlier this year. Demand has also plunged during the pandemic.

Top German carmakers Volkswagen and Daimler suffered severe losses in the second quarter, when the brunt of the restrictions hit the German economy, while smaller parts suppliers have been left fighting for survival.

Prior to Merkel’s meeting with industry representatives, there were calls for greater government support for the auto sector, a key driver in Europe’s largest economy.

Trade union giant IG Metall joined forces with the Greens and the Social Democrats (SPD) to call for a state investment fund to keep small- and medium-sized companies in the industry afloat.

In June, carmakers failed to persuade the government to include state-funded subsidies for the purchase of new vehicles in a coronavirus aid package, following pushback from the SPD and outcry from environmentalists.

Greenpeace activists assembled in front of Merkel’s chancellery in Berlin on Tuesday to protest against air pollution and call for a more climate-friendly approach to travel.

They used chalk to draw on the ground a 50-square-metre picture of a burning planet Earth being run over by an SUV, a spokesman said.

“If the combustion engine is not phased out, traffic will remain at the bottom of the league in terms of CO2 savings,” said Benjamin Stephan, an expert in transport policy with Greenpeace.

He was sceptical as to whether state aid was necessary for the auto branch, noting that the latest car registration data had returned to levels seen last year.

“The industry doesn’t have a sales problem, it has an innovation problem,” Stephan added.

On Tuesday, the European Environment Agency (EEA) released a report blaming air pollution for over 400,000 premature deaths each year in the European Union.

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