Automobile manufacturing in the EU has slowed down significantly after domestic steel prices in the region crossed €1,300/mt, making the raw material unaffordable to users, according to the European Automobile Manufacturers’ Association (ACEA).
The ACEA blamed the European Commission’s (EC’s) three-year extension of safeguard measures for steel imports for the current predicament of the auto industry in a media statement on Friday. The association stated that these extensions have caused a serious shortage in steel supply since COVID-19 related lockdowns lifted in the second half of last year.
Most of the automobile manufacturers use over 90pc of steel from the EU, which has put a strain on local steel production, leading to a material shortage as automobile manufacturers are unable to balance production with imported goods, ACEA stated.
ACEA added that the nominal relaxation by the EC for imports of some automotive grades is not enough to alleviate the overall shortage faced by the end users.