ACEA statement on CBAM downstream extension proposal

The European Automobile Manufacturers’ Association (ACEA) takes note of the recent discussions surrounding a further extension of the CBAM scope to include additional downstream products. The direction of these discussions, in particular in the European Parliament and Council, raise several concerns when it comes to the proposed breadth of the extension and the timing of its implementation.

It remains unclear to ACEA members why decisions have been made on the inclusion of certain products and on the exclusion of others. Whereas the methodology presented by the European Commission makes sense in theory, calculation details are missing, leading to confusion as to why certain automotive products were included and why some were not.

The automotive sector, as an importer of substantial amounts of steel and aluminium products, will be significantly affected by the downstream extension of the CBAM. It is important that the voices of industries like automotive are heard.

In particular ACEA urges that the following aspects are taken into account by the co-legislators:

Passenger cars should remain excluded at this stage, given the significant administrative burden, costs and implementation challenges that would come with that.,
Heavy-duty vehicles of CN codes 8701 and 8704 should be included, given their different, more localised supply chain structure and their significantly greater use of steel compared to passenger cars.
The functionality of the CBAM should be tested prior to extension. An expansion of the scope already in 2028, without a thorough post-2027 analysis of the functionality and impacts of the initial CBAM scope, carries substantial risks. Possible additional pressure on the already existing shortage of accredited verifiers also must be taken into account when looking at the implementation date of a further downstream extension. ACEA recommends the scope extension to be delayed until 2030.
An adjusted de-minimis is needed in order to mitigate administrative impacts that a downstream extension will have on businesses such as automotive manufacturers. An additional de-minimis based on a one-tonne threshold, per supplier, per reporting period would bring a much-needed reporting simplification tool for large importers, while maintaining the environmental integrity of the existing threshold. This would also be in line with the Commission’s aim for burden reductions for companies.
There is a major concern that extension of the scope to include finished complex automotive parts will come with a significant cost burden. Many parts contain tens, if not hundreds, of individual components, sourced from a wide network of sub-suppliers. Fully mapping this supply chain and establishing accurate values at each stage will be complex and burden intensive. The inclusion of such parts should be limited.

Looking now to the committee vote in the European Parliament, followed by subsequent plenary vote and trilogue with Council and Commission, ACEA strongly recommends the above points are taken into account when finalizing the legislative file. Only then can the CBAM truly deliver on its objectives within the wider automotive ecosystem.

ACEA takes note of the recent discussions surrounding a further extension of the CBAM scope to include additional downstream products. The direction of these discussions, in particular in the European Parliament and Council, raise several concerns when it comes to the proposed breadth of the extension and the timing of its implementation.

Notes for editors