Europe’s largest automotive lobbying group the European Automobile Manufacturers Association (ACEA) is welcoming the European Commission’s plans to publish the Critical Raw Materials Act (CRMA) next week, with a number of recommendations, Kallanish reports.

The upcoming regulation should create a supportive investment environment for mining, refining and recycling projects of strategic raw materials, the ACEA says. It cites low energy costs, fast authorisation procedures, practical environmental standards and skilled workers as crucial to such nurturing.

Among other things, the association is also calling on the EU to enhance domestic capacity and remove barriers to mining, refining and processing. It's also calling on the EU to improve supply security and diversity through free trade agreements and raw materials partnerships.

Materials that are of “utmost strategic importance” to the European auto industry include: lithium, nickel, manganese, cobalt and graphite for lithium-ion batteries; iridium, platinum, tantalum, cobalt and nickel, for hydrogen production; and rare earth elements such as dysprosium, neodymium and praseodymium for electric motors’ permanent magnets.

“ACEA and its members see accessibility to critical raw materials as one of the most important precursors for delivering decarbonisation of the automotive sector,” the group says.

The EU’s “outdated” list of strategic raw materials must be updated “on a rolling basis and be sector-based, as needs and transition urgency levels vary by different sectors, it says.

“The automotive sector asks for a concrete and rapid action plan to be developed alongside the CRMA in order to provide clear guidance and predictability for the industry,” ACEA adds.

The association also believes the Commission should focus only on supporting entrepreneurial stockpiling, instead of a central stockpiling as reportedly proposed. That’s because the latter isn’t “expedient in times of demand-driven markets,” the automakers argue.

According to a draft of the CRMA legislation, seen by Kallanish on 8 March, “the Commission shall set up a system to aggregate the demand of interested Union undertakings consuming strategic raw materials and Member State authorities responsible for stockpiling and seek offers from suppliers to match that aggregated demand.”

The plan is to conduct joint purchasing under one central agency, rather than “uncoordinated national measures” to ensure secure and sustainable supply of the materials. EU authorities say this will prevent competition distortion and fragmentation of the internal market.

EU companies and member state authorities in this system can “jointly negotiate prices or other terms and conditions of the purchasing agreement, or use joint purchasing in order to achieve better conditions with their suppliers or to prevent shortages,” states the draft.