European carmakers are pushing back hard against Brussels’ latest talk of EU tech sovereignty, warning that cutting themselves off from US technologies would likely raise costs for drivers and squeeze an industry already fighting on price. Volvo Cars and Stellantis are effectively saying the same thing in different accents: autonomy sounds neat on paper, but the bill lands somewhere, and it usually lands on consumers.
The complaint comes as European authorities float a package of laws aimed at making the region less dependent on outside technology, especially from the United States. That goal may be politically tidy, but the auto sector is deeply wired into American semiconductors, AI systems, and cloud infrastructure, which are now baked into everything from software-heavy vehicles to driver-assistance features.
Volvo and Stellantis warn about higher costs
Volvo Cars chief executive Håkan Samuelsson said European consumers would lose if restrictions on US technology were imposed, while Stellantis chief technology officer Ned Curic said the same approach would simply drive up costs for manufacturers. That is not exactly a subtle warning, and it lands at a sensitive moment: European brands are already squeezed by aggressive Chinese competition and by the expense of building software-defined cars.
Samuelsson also argued that if Europe wants homegrown alternatives, they should emerge through free-market competition rather than regulation. That is a familiar line from industry, of course, but it is also how the US and China built much of their tech muscle: not by declaring self-sufficiency, but by backing scale until it became a moat.
Why carmakers fear regional tech silos
For global carmakers, one of the least glamorous but most important issues is infrastructure. Curic said it would be awkward for a company like Stellantis to maintain separate systems in every region, and that kind of fragmentation could shrink markets rather than expand them. In other words, a carmaker does not just need a badge and a factory anymore; it needs a stack, and stacks do not respect borders very well.
That is especially true as advanced driver-assistance and automated driving become more software-intensive. The more cars depend on computing power, the harder it gets to pretend that Europe can wall itself off and still move at the same speed as the US or China.
- European carmakers rely heavily on US chips
- AI and cloud services are now central to vehicle software
- Separate regional infrastructure would raise operating costs
Volkswagen wants choice, not forced separation
Volkswagen chief Oliver Blume has taken a more diplomatic line, saying data processing and protection matter, but that companies should still be free to choose the technologies they use. That sounds sensible because it is: if Europe wants to build competitive alternatives, it will need adoption, not just slogans about sovereignty.
Volvo’s stance is also a reminder that the modern auto industry is already global in ways politicians cannot fully unwind. The company is Swedish in branding, Chinese-owned through Geely, and still dependent on American technology from Google and Nvidia. That is the real awkwardness here: the supply chain has long since ignored the borders that policy now wants to redraw.
Europe’s tech sovereignty push faces an expensive test
The European Commission argues that greater independence can coexist with openness to trusted partners outside the bloc, and that the push will encourage innovation, investment, and scale. The automobile industry is betting the opposite: that any attempt to formalize separation will slow product development and make European cars more expensive just as rivals from China keep leaning on speed and price.
The likely outcome is a compromise, because the alternative is messy even by Brussels standards. Europe can talk about strategic autonomy all it wants, but if it wants competitive cars with modern software, it may still need American chips, American cloud, and probably a little humility too.