Background information

The multi-module programme “Future investments for vehicle manufacturers and suppliers” was set up in June 2020 as part of the crisis packages adopted by the former Federal Government to deal with the negative impact of the COVID-19 pandemic. At that time, the government had decided to devote around €2 billion to this programme (co-financed by NextGenerationEU). The funding framework provides a strong investment impulse to initiate a sustainable, rapid and technology-neutral transformation of the vehicle industry. This requires investment in new concepts, processes, products, qualifications and production facilities. Already in 2021, the former Federal Government set up the so-called “Future Fund for the Automotive Industry”. To support the German automotive industry with the changes ahead, the fund was invested with €1 billion to be used between 2021 and 2025.

Content of measure

The "Future Funds for the Automotive Industry" was continued under the current Federal Government and financial support is mainly available in the following four areas:

1. Setting up and running regional transformation networks is supported with a view to bringing together relevant local actors. Within these networks, participants are asked to jointly develop transformation strategies for their regions. Grants can also be devoted to setting up or expanding so-called transformation hubs. Unlike regional networks, transformation hubs need to focus on specific technological advancements in key areas (such as engines, batteries, software development). Some €340 million were devoted to this pillar with the goal to improve knowledge transfer for SMEs Knowledge generated in networks or transformation hubs are ideally implemented by SMEs.

2. Financial support can also be granted to projects pushing ahead with digitalisation in the automotive industry (e.g. digital twins/virtualisation, operating systems, e-architectures, software and systems engineering and security/validation). Some €340 million were devoted to this pillar.

3. Grants are also available for projects that strengthen sustainable supply chains – particularly regards the circular economy. In addition, SMEs shall be enabled to contribute to electric vehicle production, electric drives and fuel cells. This pillar is supported with €320 million.

4. Finally, projects can also apply for grants to develop new further training concepts to support employees affected by the transformation in the industry.

These pillars are implemented by different federal ministries, including the Federal Ministry of Labor and Social Affairs (BMAS), the Federal Ministry of Digital and Transport (BMV) and the Federal Ministry of Education and Research (BMBF) or the Federal Ministry of Economics and Climate Protection (BMWK).Operationally, different funding guidelines are in place and as the measures address different actors, companies (preferably SMEs but also start-ups) can apply for funding as well as research organisations or networks.

Use of measure

In an answer to a parliamentary hearing request, the Federal Government provided first information on the use of the fund’s grants on 8 November 2023. The Federal Government stated that already €104 billion have been spent from the “Future Fund for the Automotive Industry”. Over €36 million were spent on digitalisation projects, nearly €19 million went to the projects devoted to the circular economy, over €14 million were spent on developing employee training concepts and over €34 million had been granted to projects supporting regional transformation networks or transformation hubs (Deutscher Bundestag, 2023).

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Sector specific set of companies SMEs Start-ups	Does not apply to citizens

Actors and funding

Actors	Funding
National government Trade unions Employers' organisations Company / Companies	European Funds National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Consulted	Consulted
Form	Direct consultation outside a formal body	Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

• Social partners jointly
• Main level of involvement: Sectoral or branch level

Involvement

The Future Funds for the Automotive Industry is based on recommendations that were provided by an expert committee on 18 August 2021. The expert committee had provided its input on the transformational changes in the automotive industry during the sixth high-level talks of the so-called "Concerted Action Mobility". Latter was set up by the Federal Government inviting different stakeholders and experts to discuss mobility and climate issues. Employer and union representatives took part along with other participants. After the next Federal Government had been elected and formed in the second half of 2021, a new expert committee was formed under the auspices of the Federal Minister for Economics and Climate Protections. Members include business representatives, the German Metallworkers' Union as well as research representatives.

Views and reactions

As stated before, employer and union representatives were involved in recommended suitable measures to support the transformation in the automotive industry.

Sectors and occupations

This case is not occupation-specific.

Sources

• 17 December 2024: Automotive Industry (www.bmwk.de)
• 17 December 2024: Expert committee for the transformation in the automotive industry (expertenkreis-automobilwirtschaft.de)