USA, Transatlantic Trade and Investment Partnership
ACEA welcomed the formal opening of trade discussions between the EU and US, as it believes that a potential deal could significantly boost trade and economic growth for both partners.
In effect, the Transatlantic Trade and Investment Partnership (TTIP) could represent an opportunity to break down regulatory barriers in the auto sector, reduce costs and increase commercial predictability. This may be achieved while respecting EU and US sovereignty, and without sacrificing vehicle safety and environmental performance.
Economic potential
EU-US auto-related trade currently accounts for some 10% of total trade between the two regions. Together, the EU and the US account for 32% of global auto production and 35% of global auto sales. Under a TTIP, they would therefore represent the largest share of auto production and sales ever covered by a single trade agreement. The TTIP would strengthen the EU and US as worldwide auto standards setters.
According to the European Commission’s impact assessment reports, current automotive non-tariff barriers (NTBs) are equivalent to an ad valorem tariff of around 26%. The elimination of tariffs and just a quarter of existing NTBs would increase EU vehicle and parts exports to the US by 149% for the period 2017-2027. The estimated increase in EU-US auto trade achieved with the elimination of tariffs and NTBs would account for more than a third of the total estimated increase in bilateral trade flows associated with a successful TTIP negotiation.
A comprehensive package
If both sides are to realise the full economic potential of the TTIP, achieving a comprehensive auto package must be a priority. Such a package should include the phase-out of tariffs and NTBs, as well as improving regulatory convergence. These priorities are directly linked and should thus be considered as one single undertaking. To achieve an ambitious outcome, especially with regard to regulatory convergence, there must be strong and sustained political will at the highest levels.
Close cooperation between the EU and US automobile industries
Throughout the TTIP process, ACEA has been working actively with its US counterparts, the American Automotive Policy Council (AAPC) and the Alliance of Automobile Manufacturers (Alliance), to provide input to the authorities on both sides of the Atlantic. ACEA is also working closely on regulatory convergence with the Truck and Engine Manufacturers Association (EMA).
Proving the equivalence between UNECE and FMVSS regulations
In support of the TTIP negotiations, the Alliance, in consultation with its international partners, is sponsoring a study to examine the degree to which vehicles produced in the EU under UN ECE safety regulations can be expected to provide essentially equivalent real-world safety benefits when driven on US roadways as provided by vehicles produced in the US following Federal Motor Vehicle Safety Standards (FMVSS) (and vice-versa for US self-certified vehicles when driven on EU roadways).
This study is being conducted by the University of Michigan Transportation Research Institute (UMTRI) in partnership with SAFER, a transportation research centre at Chalmers University in Sweden.
Trade flows
Today, the US is the second biggest importer of cars into the EU in terms of value, representing a 19% share of EU imports in 2016. In terms of units, it comes in fourth place.
The US is the number one destination of EU car exports both in terms of units (with a 21.3% share of EU exports in 2016) and of value (30.2% share).
