EC Rejects Role in Shrinking Excess Auto Capacity

The European Commission won't take on the politically sensitive task of guiding the auto industry's effort to reduce overcapacity in the region, the Financial Times reports.

Industry Commission Antonio Tajani tells the London-based newspaper that setting policy to shrink auto capacity is the job of individual countries. He notes that excess capacity is mainly a problem for Italian and French carmakers but doesn't affect their German counterparts.

Fiat-Chrysler CEO Sergio Marchionne, who also heads the European carmaker group ACEA, has called for the EU to lead a coordinated cross-border effort to close plants. He notes that individual countries are blocking moves to shutter facilities to protect local jobs, thus resulting in 20% more plant capacity in Europe than the industry needs.

Tajani says the EC could help carmakers restructure with financing for such projects as worker retraining and technical innovation.

Marchionne and executives from Daimler, Ford, PSA Peugeot Citroen and Renault are scheduled to meet with Tajani on Wednesday.