VDA President Hildegard Müller on the EU-Mercosur trade agreement

"The conclusion of the negotiations on the EU-Mercosur trade agreement is good news for the entire European business location and for Germany as an export country. The agreement will mutually create prosperity, growth and jobs, help in the joint fight against climate change and promote the diversification that politicians have repeatedly called for.

The EU-Mercosur agreement creates great opportunities for both car manufacturers and car suppliers. The importance of an agreement for the German car industry lies, among other things, in the reduction of Mercosur's currently relatively high tariffs of 14 to 18% on car parts and even 35% on cars. At the same time, the tariff reductions on EU side will open up new opportunities for exporters in Mercosur and strengthen the economy there.

Germany is an export nation. Around 70% of jobs in the German automotive industry depend on exports. This is the basis of our prosperity. In 2023, German manufacturers produced around 355,000 cars in Mercosur, mainly in Brazil and Argentina - and 375,000 cars in the first nine months of this year alone. In contrast, only 20,700 cars were exported from Germany to Argentina and Brazil in the whole of 2023. Thus there is still significant potential to increase these exports, and the conclusion of negotiations on the Mercosur trade agreement is paving the way for this. The share of electric vehicles in exports was 16% and could also rise further as a result of the agreement, thus further driving forward e-mobility in South America.

We must be aware that only a strong and export-capable industry will be able to master the major challenges of transformation and thus make a decisive contribution to climate protection. Only with economic strength the EU can play an important role on the world stage. With the conclusion of negotiations on the EU-Mercosur trade agreement, an important step was taken today.

The final text of the agreement must now be submitted to the EU states and the European Parliament for decision as soon as possible so that the agreement can actually enter into force as quickly as possible after approval."