Manufacturers are subject to a variety of regulation, testing and tariffs. Manufacturing is an important pillar of TTIP and in order for TTIP to be comprehensive, barriers to both industry and services need reducing. It is estimated that exports of manufactured products from the EU could go up 6% as a result of TTIP.
One of the key areas is the automotive industry, where it is estimated TTIP would result in a 41% increase in exports of EU vehicles. The EU is the largest motor vehicle producer in the world, with 22% of the share, which adds €99bn to the EU economy. Despite making up 22% of the global share, the EU automotive industry only makes up 7% of the US automotive market. It is important that this industry is seriously considered in the construction of the TTIP agreement.
The main barrier to the EU automotive industry in the US is regulatory divergence. The added regulation is expected to add 30% to the cost of a European car on the US market; studies associated these non-tariff barriers to be equivalent to a 26.8% tariff. TTIP could eliminate current tariffs and address the NTBs allowing the automotive industry to benefit.