Volvo, Stellantis Warn EU Tech Sovereignty Policies Will Drive Up Costs for Automakers
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Top executives at Volvo Cars and Stellantis warned that the EU's tech-sovereignty agenda — curbing reliance on US technology — will drive up costs and shrink Europe's auto market. This means → Brussels' industrial-security ambitions are now on a collision course with automakers' global competitiveness.
What exactly are automakers pushing back on?
The European Commission last month unveiled a tech-sovereignty package — a set of policies designed to reduce dependence on US big tech by promoting homegrown alternatives and imposing digital-procurement requirements.
Volvo Cars CEO Håkan Samuelsson put it bluntly: "If the EU puts any restrictions on American technology, Europe will be the only loser." He welcomed European alternatives but insisted they should emerge through market competition, not government mandates.
Stellantis CTO Ned Curic was more specific: maintaining separate tech frameworks across regions is inherently expensive, and automakers are already stretched by EV-transition spending and competition from Chinese rivals.
Why can't European automakers quit US tech?
European automakers depend heavily on American chips, AI systems, and cloud services. Volvo Cars — owned by China's Geely — still relies on Google and NVIDIA to keep its products competitive.
This means → as the industry shifts to software-defined vehicles — where computers manage everything from battery performance to autonomous driving — the choice of underlying tech platform directly determines who can compete globally.
In plain terms = today's car is increasingly a computer on wheels, and the core software and hardware of that computer mostly comes from the US. There is no equivalent substitute available in the short term.
Volkswagen joined in — why are automakers speaking up together?
VW CEO Oliver Blume issued a similar warning this month: the pursuit of homegrown tech must not lead to over-regulation, and AI and data need "a degree of freedom to develop."
All three automakers converge on one position: Volvo argues for deeper US-EU tech integration as a shared defense against China; Stellantis and VW focus on the cost math.
This reflects a collective industry judgment — Europe's competitive threat is China, not America. Restricting US technology amounts to tying one's own hands.
How did the EU respond? Will the plan actually shut out US firms?
The Commission said the package "aims to boost resilience while remaining open to trusted partners," and will unlock investment, innovation, and scale.
The current proposal creates a four-tier certification framework ranking technologies by degree of foreign influence — but it has not explicitly excluded US firms from most public procurement, nor imposed sovereignty requirements on private companies.
In plain terms = the line the proposal draws is still vague — public procurement faces new hurdles, but private business is not restricted yet. What automakers really fear is that the line will creep toward the private sector over time.
What is the key variable in this standoff?
Brussels-based researcher Zach Meyers noted the proposal "represents a major shift in the EU's stance" — Brussels had long championed open markets, while the US and China had already abandoned international trade norms.
This means → the EU is moving from "rule defender" to "rule reshaper," and how far it turns will determine how high the costs run.
The next test: if sovereignty requirements extend from public procurement to private enterprise, whether the market can absorb the cost pressure will directly shape the trajectory of European auto competitiveness.
Content is for reference only, not financial advice.