September 10, 2025

The following is a press release:

Europe’s automotive sector is undergoing rapid transformation, driven by the shift to zero-emission mobility, digitalisation and global competition. In this context, the Automotive Regions Alliance (ARA) gathered in Munich for its 4th annual political conference, calling for dedicated EU funding for innovation and infrastructure, an accelerated rollout of electric and alternative fuel networks, and support for SMEs and regional clusters to secure a fair and competitive transition.

The European automotive sector is undergoing a profound transition towards zero-emission mobility, accelerated digitalisation and growing global competition, reshaping the demands on the industry and its regions. At the same time, trade tensions, supply-chain vulnerabilities and uneven infrastructure are adding to pressure on manufacturers, suppliers and workers. In this context, the Automotive Regions Alliance (ARA) held its fourth annual political conference in Munich, gathering representatives from most of its 38 member regions on the margins of the IAA car fair at the invitation of the Region of Bavaria and the European Committee of the Regions. Regional leaders assessed the sector’s challenges and set out joint demands to ensure a just and inclusive transition.

During the conference, ARA members adopted the Munich Declaration, reaffirming the Alliance’s ambition to advance the transition of the automotive sector towards climate neutrality by 2035 while emphasising the need for a fair transition that supports workers, businesses and communities across Europe. ARA members underscored that electrification remains an important driver of decarbonisation but insisted on a technology-neutral approach that also allows biofuels, e-fuels and hydrogen to play a complementary role. They highlighted that flexibility in technological choices is essential to preserve competitiveness, support innovation and reflect regional diversity.

Regions’ representatives stressed that the sector’s green and digital transitions demand major investments in technology, infrastructure, innovation and skills, while also warning of risks from retaliatory tariffs and disrupted supply chains already affecting regional economies. They called for a dedicated place-based just transition dimension in the next EU budget (2028–34), demanding that the Commission increase funding and stressing that automotive regions, which are already investing heavily in innovation, mobility and skills, must be explicitly included.

While welcoming the European Commission’s Industrial Action Plan and the launch of a European Autonomous Driving Alliance, regional leaders expressed concern about the lack of territorial focus in EU measures. They regretted the exclusion of ARA from the Strategic Dialogue on the future of the industry and called for closer cooperation with regional authorities in rolling out charging infrastructure, supporting SMEs and suppliers, and investing in gigafactories, recycling and innovation ecosystems.

Employment and skills were also placed at the centre of the discussions. ARA members emphasised the need for stronger training and re-skilling, closer cooperation between education and industry, and reinforced EU support through the European Social Fund Plus and the European Globalisation Fund.

Quotes

Kata Tüttő (HU/PES), President of the European Committee of the Regions: "The automotive sector is an economic engine, but much more than that: it is a cultural cornerstone, shaping the identities, livelihoods, and aspirations of Europeans. As regional and local leaders we know how difficult it is for the European automotive sector to continue its transition as the tariff war, and the worsening of the international scenario are triggering further instability and disruptions. While we work to help companies and workers re-skill and innovate and to promote the adoption of cleaner solutions on the ground, we need to mobilise together to avoid that the next generation of EU investments -- backed by the budget 2028-2034 – heavily weaken regions' role, as proposed by the European Commission. We need instead to empower them, combining cohesion and competitiveness in order to drive a just and inclusive transition."

Guido Guidesi, Regional Minister for Regional Development of Lombardy and ARA chair: “The European Commission must now choose whether to safeguard Europe’s automotive industry or allow the entire sector to collapse. Unless the current rules and framework are revised, Chinese manufacturers will be handed a near-exclusive control. Europe, meanwhile, will be left to face mass unemployment, as this industry - directly and indirectly – supports 13 million jobs. With an ‘electric-only’ approach, environmental targets will be met only at the cost of industrial desertification. The Commission must decide – time has run out.”

Tobias Gotthardt (DE/Renew), Secretary of State of the Bavarian Ministry of Economy, Regional Development and Energy and ARA Vice-Chair: The automotive sector now needs to fully accelerate and have a clear run: Europe must act boldly and in unison to provide the automotive industry with tailored support for change and to achieve new competitiveness together. Commission President Ursula von der Leyen has announced that she will make the transformation of the automotive industry a priority for her second term in office. We automotive regions take her at her word and demand action. The next steps of the Automotive Action Plan, which the EU Commission presented earlier this year, will be decisive: we need a clear, effective course of action – not a paper tiger with a lot of hot air. Europe must deliver concrete results to secure its industrial future.”

Anne Sander, Regional Councilor for the Grand Est region and ARA Vice-Chair: “Our presence today in Munich shows both our determination and the urgent need for Europe to clarify its roadmap for the automotive transition, with clear commitments towards regions. This is not only about the industry, but about territories and the people who keep this sector alive. The transition will only succeed if it is territorialised. Regions, through partnerships with local authorities, businesses, training centers, universities, and employees, are uniquely placed to co-design effective solutions – where top-down approaches often fail. The action of the regions is an essential lever of competitiveness and transition: as such, it must be valued, protected, and financed for the future."

Background

· The Automotive Regions Alliance is an initiative of the European Committee of the Regions, consisting of 38 participating regions, that recognises the need for decisive action to achieve the EU's climate targets. It aims to bring together regions with a strong automotive sector that want to play an active role in decarbonising the transport sector and contribute to achieving the European Green Deal targets, to ensure a just transition for automotive regions. The Alliance is currently chaired by the region of Lombardy. As of 2026, the chairmanship will be handed over to the region of Grand-Est.

· With the adoption of the internal combustion phase-out by 2035, the Alliance has a key role to play: the European Commission is mandated to report on what budgetary resources are needed to make this transition fair for all by the end of 2025. The legislators call on the European Commission to base its report on the work of the Automotive Regions Alliance.

Contact

Theresa Sostmann

Tel: +32475999415

Theresa.Sostmann@cor.europa.eu