20,660,434 euros.
That was the aid that the Government of Spain granted in 2017 to PSA (now Stellantis after its merger with FCA) as “regional incentives for the correction of territorial economic imbalances.” Just two years later, the European Commission already doubted the appropriateness of this aid. Almost a decade after its delivery, Stellantis will have to return the money.
20.7 million euros. It was the money given by Mariano Rajoy’s Government in 2017 to the automobile conglomerate PSA. The company, then directed by Carlos Tavares, had been looking for money framed within the “Industrial Plan 2014-2020” in which funds from the European Union were available.
The Spanish subsidiary of PSA, known as PCAE, requested aid of 392 million euros in 2014 to carry out the necessary actions to modernize the plant and launch a new model. The aid program was expanded, with another 100 million in subsequent years because PSA was going to produce a new vehicle platform and a new SUV car in Vigo.
In 2017, shortly before Mariano Rajoy left Moncloa, the Government of Spain provided the aforementioned aid of 20.7 million euros since it corresponded to the maximum percentage allowed with respect to the investment that was planned to be used.
many doubts. In 2019the European Commission was already beginning to doubt the legality or compatibility of this aid. In a document submitted thenquestioned whether the subsidies provided were meeting the criteria to create employment in the area. In said letter, PSA was already invited and the Government of Spain has explained the reason for this aid.
In that document, the European Commission questioned whether the positive effects of the aid outweighed the negative ones and, therefore, that the decision to financially support the company with those more than 20 million euros was not economically doping its commitment to our country instead of taking production to the Trnava plant (Slovakia) with which Vigo competed.
According to the European Commission, it believed that both plants were competing on equal terms and that the socioeconomic context of the Slovaks was no worse than that of Vigo. Furthermore, they pointed out that the defense that this aid helped preserve employment in Galicia in the face of a possible relocation to Morocco (a position defended by Spain) was not sufficient because PSA had already previously relocated other vehicles that were previously manufactured in Spain.
Seven years of research. Already in 2020, Europe continued to defend that the Commission had its doubts “regarding the contribution of investment projects to the development of the region in question”, as they stated in elDiario.es.
Then it was thought that the company’s true intention was to improve the factory facilities with the sole objective of improving the company’s competitiveness but that it had nothing to do with an improvement in innovation and local investments. There were even doubts about the compatibility of being able to deliver these aid to a company like PCAE (the Spanish subsidiary of PSA).
One of the most compelling reasons presented by the European Commission is, as they point out in The Worldthe choice of the Vigo company to the detriment of the Slovaks. And it is considered that opting for a more economically developed region to receive aid contravenes the principles of cohesion of the European Union, which prevents the delivery of this type of subsidies.
Case closed. Now, the Government of Spain has notified the European Commission that it is withdrawing the subsidy of 20.7 million euros. He has done it because he cannot prove its legality. As the money has not yet been delivered, the European Commission has closed the investigation, they explain in the Galician media. praza.gal.
At this time, Spain has not been able to demonstrate that the number of jobs increased after the aid was granted nor that it represented an economic boost in the region. In fact, it was possible that the number of jobs could even be reduced, as they point out in Motorpassion.
During this time, the money has not been delivered because it remained frozen with the European investigation. Now we know that Stellantis will not charge it.
Photo | Stellantis
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