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Speech at event to present Plan to Boost Value Chain of Automotive Industry towards sustainable and connected mobility

Moncloa Palace, Madrid, Monday 15 June 2020

PEDRO SÁNCHEZ_ President of the Government

Good day.

Welcome everyone; dear vice-presidents of the government and ministers. Dear Secretaries-General of the trade unions CC.OO and UGT. And of course, dear José Vicente and all the representatives of the automotive industry. Thank you for coming here, to a very important event for the government, and undoubtedly for the sector as well, as has been rightly mentioned in the preceding speeches. The first thing that falls to me to say is to congratulate everyone present here, at this event, for the Plan to Boost the Automotive Sector that we are going to present.

It is not necessary, and José Vicente has already said this, to explain to the Spanish people the importance of this event, of this Plan, as they are aware of the importance of the whole automotive sector.

It accounts for one tenth of our GDP, almost 20% of our exports, employs 650,000 people directly, and almost 2 million people in total - directly or indirectly. And at this level, I don't need to explain either the importance of this sector for the future of the Spanish economy, and also, I would say, for the future of the European economy, for the ecological transition of our economy in an era precisely marked by the climate emergency. We have spoken about the health emergency, but there is another emergency pending resolution, among us all, which is the climate emergency.

The automotive industry is a strategic sector for Spain, for our economy, for the well-being and progress of our country, which this government, and this has been underscored by the social stakeholders, decisively supports, as we have from the outset. Consequently, today we present an ambitious action plan to accompany the whole value chain, represented here, while allowing us to also make progress towards sustainable mobility. An extensive national value chain made up of thousands of companies, most of which, as indicated here, are SMEs.

It is a question of doing whatever is necessary, as has been said here, to cushion the tremendous consequences and losses of the sector in 2020, as a result of the COVID-19 crisis and the impact that the lockdown and the restrictions on mobility have had on the automotive sector, on car sales, whilst also looking to the future. We are dealing with the present whilst also looking to the future and laying the foundations for how the industry should be shaped, of what tomorrow's automotive industry is already starting to look like: an industry that will undoubtedly come out stronger as a result of electrification and digitalisation, and that will contribute to our country progressing down the path of the just ecological transition, to which not only the Government of Spain is committed, but also, I am sure, the productive sector and Spanish society as a whole.

This Plan is a clear example, yet another example, I would say, of the commitment of the Government of Spain to the automotive sector, in addition to the lines of credit guaranteed by the State and the 170,000 jobs that are currently protected under the legal figure of the temporary lay-off plans (Spanish acronym: ERTEs).

What's more, I feel, and the economic team has remarked on this on some occasions, that this is one of the structural reforms that we are undertaking during this crisis in terms of the adaptability of our job market to provide an alternative to many employees losing their jobs.

Now, if we want the automotive industry to continue to be competitive, as mentioned here already, I believe that we must ensure that the sector continues to adapt to the new demands of the national market, and also of the export markets because, let's not forget, as mentioned here earlier, this is an export-dependent market; hence we need to look at the new demands of both the national market and the export market, particularly at the challenge that has been mentioned by all the speakers who have come before me, which is decarbonisation with growing production demands for vehicles that are increasingly cleaner and more sustainable.

Over the coming years, our country will manufacture some 15 models of saloon car, and Spanish industry is also playing a leading role in production in other segments, such as motorbikes and electric buses, as mentioned here.

For all these reasons, I would like to share with the public that this Plan we present here today, and which has clearly been agreed with the social stakeholders, includes a very significant budgetary provision - of 3.75 billion euros, of which 1.535 will be freed up in 2020 and the other 2.215 between 2021 and the following years. This will be allocated as follows:

• Firstly, 300 million euros will go to renewing the public vehicle fleet, for charging points, the adaptation of cities and urban environments to new mobility needs and the electrification of transport.

• 250 million euros for the renewal of the fleet towards more sustainable and efficient vehicles.

• 415 million euros for research, development, innovation, boosting digitalisation, connectivity, and also for innovative solutions for sustainable mobility and associated industry.

• 2.69 billion euros for investments in the value chain of the industry between 2020 and 2022.

• And 95 million euros for vocational training and skills. As mentioned here before, I believe that it is very important to invest economic resources in this task that lies ahead of us to improve the vocational training of a great many young people that wish to join the automotive sector as workers.

In short, it is a question of a Plan for the recovery of the automotive sector, and as mentioned before, and I would also like to underline this, of boosting it through unity. And unity, which I feel is a very important trait, is one of the lessons we can take away from the COVID-19 crisis. Because the reconstruction, or the socio-economic recovery of our country, will be quicker the more united we are. That means no only public institutions and political parties, but also social stakeholders - which means business owners and workers. Not only will it be quicker, but it will also be more inclusive and effective with unity. Hence, if I aspire to anything, it is precisely that today's unity that can be felt in this agreement, in this Plan for the Automotive Sector, should also prevail in the legislature that has just begun.

The Plan is aimed, as you know, at the whole industrial value chain, with the goal of providing a response, with technology and own capabilities, to the new mobility needs.

But also, and this is something I especially wished, to highlight the "industrial ecosystem", particularly made up of small- and medium-sized enterprises, to digitalise to become more competitive, and to adapt production plans to the foreign trade market.

It also seeks to boost the electrification of transport, which is one of the tasks pending in our country, in line with the goals of decarbonisation, in line with the sustainable development goals which the government clearly aligns with its economic policies, and with the goal of attracting investment for the manufacture of new models of low consumption vehicles.

Hence, it is a question of a plan that is in line with our international commitments in the fight against the climate emergency, but also in line with the commitment to clean air in our cities.

It also amounts to a strengthened commitment to electric vehicles, to sustainable mobility, significantly increasing the provision to the MOVES Programme and, as a novelty in this year's edition, supporting something that I believe is also important - the local authorities in quick adaptations in urban environments.

New investments should obviously be backed by a clear boost to R&D+i in mobility, activating the development of new technologies that allow a competitive automotive sector to be deployed in Spain in the medium and long terms.

This Plan also promotes a younger vehicle fleet in Spain which has, and other speakers have mentioned this, an average age of almost 13 years. This is one of the main challenges we face. We have enacted a line for the renewal of the fleet of new vehicles with all technologies, including electric and hybrid vehicles, with a series of measures aimed at reducing emissions.

And one of the aspects that most caught my attention and I felt to be very positive is that in order to receive a subsidy it will be obligatory to scrap a vehicle that is more than 10 years old, and the new vehicle to be acquired must be among the most efficient on offer. I feel that this is a very clear example of the commitment of the industry, of the social stakeholders and of the government to this transformation of the automotive sector.

This line also includes something very important, which is the social perspective, with an additional subsidy in the case of people with reduced mobility or that are members of households with income below 1,500 euros a month. I feel that including these groups and displaying this empathy, above all after everything we have suffered, is also very telling and says a great deal about the social stakeholders, for taking this into account.

And something else that is very important, and I have just come here after speaking to some mayors, and the local authorities are calling for us to actively participate in the Social and Economic Recovery. It is for the local authorities to be able to disburse part of the surplus to invest in clean vehicles for their local fleets. And I feel this is very important because we are including such an important institution as local authorities in this collective challenge.

The subsidies for the renewal of the fleet will be made effective for those eligible vehicles acquired with the conditions established as from tomorrow.

In addition to the investment I have indicated you have new tax measures, and new regulations geared to fostering private investment in the value chain of electric, sustainable and connected mobility.

And finally, the Plan, as I said before, includes a pillar that is very important for me, for all of us, which is training and employability. This is a sector in mid-transformation, and consequently we must adapt and transform and guarantee greater employability, with the aim of guaranteeing what has been said here - the existence of qualified talent which the sector is in such need of at this time.

We will guide training towards new technologies, towards digitalisation and towards means of sustainable transport. And we will do so by particularly supporting modern and adaptive vocational training, which is one of the questions we spoke of when we held the meeting on 2 March.

Lastly, I want to point out that the efforts being made by the Government of Spain do not end here.

The government has been working for some months now on a major investment and reform plan that we will submit to Brussels to obtain European Union resources - through the new Recovery Fund, when the agreement is reached at the European Council, which will include significant allocations to support the transformation we have been taking about, of which this event is a telling example.

The task of the recovery that Spain needs must span all fields and, I stress, must be sustained on unity; that is how our economy and our society will resume their progress with force.

I would like to end how I started, by congratulating everyone on this Plan, which has come about at the hands of the sector, highlighting the commitment we take on here today through our presence and by signing and endorsing this Plan, which is the future of an industry that creates quality jobs, which contributes added value to our economy and which will help us care for our planet.

That is the line to follow, one of dialogue and of stability, over the next four years ahead of us in this term of office.

Thank you very much for coming here and congratulations on the Plan.

(Transcript edited by State Secretariat for Communication)

Non official translation