Top carmakers warn EU tech sovereignty drive will raise costs
Brussels’ proposals to cut reliance on US Big Tech spark concerns among European carmakers
Volvo Cars and Stellantis have warned that European carmakers face higher costs and smaller markets if Brussels pushes too far in its drive to reduce the bloc’s reliance on US technology.
Håkan Samuelsson, chief executive of Volvo Cars, told the FT that “Europe would be the only loser” if the EU were to impose any restrictions or barriers on US technology. Stellantis chief technology officer Ned Curic said it will “drive expenses” for Europe’s car industry.
The warnings come after the European Commission last month unveiled a tech sovereignty package aimed at reducing the bloc’s reliance on Big Tech by fostering homegrown technology and introducing requirements for digital public procurement.
Under current proposals, European public officials would use a four-level certification framework to grade technology according to their exposure to foreign influence.
While the package stops short of explicitly excluding US companies from most public bids or imposing sovereign requirements on private companies, many large European companies fear it could hurt them in the short term, particularly if the sovereignty agenda expands.
“We would welcome if there were European alternatives to American technology . . . but that should be done on a free market with competition,” said Samuelsson.
The European Commission said in response to the executives’ comments that “on the contrary, the tech sovereignty package will help unlock investment, innovation and scale” and is “about making sure we are more resilient while staying open to trusted partners”.
Europe’s drive for greater digital sovereignty has gained new momentum in recent months, sparked by European concerns that US President Donald Trump’s foreign policy could force a “tech decoupling”. These fears were heightened last week after the US blocked Anthropic from exporting its Mythos and Fable models on national security grounds.
Zach Meyers of the Brussels-based think-tank Centre on Regulation in Europe said “the [EU] proposal represents a significant change in tone for the EU, which had clung to its ‘open market’ credentials long after the US and China abandoned international trade norms.”
European carmakers rely heavily on US chips, AI systems and cloud computing services to power their vehicles, amid restrictions against using Chinese technologies.
The industry is also shifting to software-defined vehicles in which computer systems control everything from batteries and vehicle performance to safety features and, eventually, self-driving functions.
Curic said the EU’s efforts to lower the use of US technology will increase costs for the car industry, which is already under pressure from large investments in electric vehicles and competition from Chinese rivals.
Stellantis, which owns Fiat, Peugeot and Jeep brands, will comply with whatever regulatory framework the EU agrees on, but Curic said it would be expensive to have different technology frameworks in various regions.
“It will drive expenses for us and . . . it will eventually drive shrinking of the markets,” he added.
Volvo Cars’ Samuelsson called for more integration between the US and Europe as the “tech war” divides China and the west. “I think it’s more important to have the relationship with the American industry and [for Europe to] join in the firewall to China,” he added.
Volvo Cars, which is owned by China’s Geely, recently received US regulatory approval to continue importing and selling its connected vehicles in America. Samuelsson noted that it relies on US partners such as Google and Nvidia to make its vehicles competitive.
Earlier this month, Volkswagen’s chief executive Oliver Blume, also cautioned against imposing too much regulation in the pursuit of developing homegrown technologies.
“When you talk about AI and data, there is an important aspect of data protection,” Blume said. “That’s important, but . . . we need some freedom to develop [technology].”
The comments echo wider concerns of European companies that the political push to reduce the bloc’s dependency on US technology risks making European businesses less competitive.
“It is simply not possible to run a business without US tech,” said a senior executive at a financial institution.