The European Automobile Manufacturers’ Association (ACEA) and the International Steel Trading Association (ISTA), have both voiced their disappointment over the European Commission’s permanent safeguard measures. EU member states approved the EU proposal on 16 January (see Kallanish 17 January).

“These measures do not take into account the needs of downstream users of steel, such as the automotive sector,” ACEA said. “Automobile manufacturers source almost all of their steel (approximately 94%) in the European Union. ACEA members are therefore most concerned about the impact that the extension of the safeguard measures, until at least July 2021, will have on access to European steel and the inflationary effect it will have on European market prices.”

The association notes that the prices and lead times for European steel has been increasing constantly for several years. Consolidation in the steelmaking sector meanwhile has reduced both the number of suppliers and the capacity for automotive steel production.

“These protective measures pose a real risk to the competitiveness of European auto manufacturers,” says ACEA secretary general Erik Jonnaert. “This also comes at a time when our industry already has to contend with major trade-related challenges: the threat of tariffs on imports of vehicles and parts to the US, the decline in the Chinese market, not to mention the prospect of a no-deal Brexit.”

ISTA chairwoman Simone Jordan meanwhile says that traders are concerned by the increasing barriers imposed through the definitive measures. “We do not feel that country-specific quotas are fair practice particularly as the statistics used are historical (2015-2017). We do not feel that those historical statistics reflect the demands of the market today,” she says, adding that ISTA hopes the measures will be reviewed and amended.