EU carmakers to press call for 40 bln euro EU loan
BRUSSELS, Oct 29 (Reuters) - European carmakers will press their call for an EU loan of 40 billion euros ($50.98 billion) to help develop greener cars in a meeting with the bloc's executive on Wednesday, their industry association chief said.
The European Automobile Manufacturers Association (ACEA) says the economic crisis and sliding consumer confidence has made it increasingly difficult to achieve EU targets to curb carbon dioxide emissions from cars by 18 percent by 2012.
Asked on arrival at the European Commission for a meeting with EU Industry Commissioner Guenter Verheugen whether he would be seeking a loan of 40 billion euros ($50.98 billion), ACEA President Christian Streiff, who is also chief executive of PSA Peugeot Citroen (PEUP.PA), told reporters:
"It is one of our targets."
Asked whether industry would be seeking the loans, Daimler CEO Dieter Zetsche said: "We have much broader scope."
EU leaders said at a summit earlier this month that Europe must be ready to follow the United States in supporting national car industries.
The Bush administration has agreed to provide $25 billion in low-cost loans to help revive ailing U.S. car makers, authorised in a 2007 energy law that requires the industry to improve the fuel efficiency of vehicles by 40 percent by 2020.
But the European Commission has already rejected the demand for a loan to help Europe's makers meet its proposal to cut CO2 from new cars to 130 grams per km, which has divided the 27 EU states.
The size of the loan envisaged would equate to over one third of the annual EU budget.
EU car-making nations led by Germany, which specialises in powerful, heavy luxury vehicles such as Mercedes (DAIGn.DE) and BMW (BMWG.DE), which emit the most greenhouse gases, have pressed for a softening of the terms of the EU proposal.
Car makers argue that a rush to legislate puts jobs and export earnings at risk, because there is no guarantee consumers will buy greener cars when they are put on the market.
The ACEA argues that 40 billion euros equates to just two years of the research and development budget for Europe's car industry and the group has been trying to kick-start a discussion of how the EU might offer support.
ACEA has also been asking the EU to bring in incentives for car owners to scrap vehicles over eight years old for a three-year period to speed up fleet renewal.
Tightening environmental legislation comes as vehicle sales in Europe are falling. The industry recorded sharp drops in July and August and a total decline of 3.9 percent in the first eight months of the year.
(Editing by Jason Neely)
