Is It Time to Buy European

The EU is debating a 'Buy European' industrial strategy, potentially setting 70% local-content targets for EVs and green tech to counter US and Chinese industrial policies. While aimed at securing strategic autonomy, the proposal faces risks of higher consumer costs and retaliation from trading partners.

Key Takeaways

• 1.The European Commission is preparing the Industrial Accelerator Act, which may include local content targets of up to 70% for strategic products like EVs.
• 2.The strategy is a defensive response to the US and China, who have already implemented domestic-preference policies like the Inflation Reduction Act and 'Made in China 2025'.
• 3.A 'Buy European' policy faces significant risks, including a 70% cost premium for EU-produced battery cells compared to Chinese ones.

Table of Contents

• The proposal
• MADE WITH SWEDEN
• What the US, China and other countries are doing
• Pros of 'Buy European'
• Cons and risks
• Sector spotlights: autos, renewables and semiconductors
• Conclusion: A balanced path forward

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