France has signaled a major policy shift, suggesting the EU could allow UK-made vehicles to qualify for "Made in Europe" subsidies. This reversal comes after Nissan warned it would close its Sunderland factory under current rules. France's trade minister acknowledged the "problem" of excluding the UK, a departure from their previous support for restrictive rules.

The Industrial Accelerator Act, which affects 60% of Europe's car market through corporate fleet regulations, needs approval from member states and parliament. The Netherlands backs UK inclusion, while BMW protects its Oxfordshire operations. EU officials suggest industry groups push for a smaller qualifying countries list that would include the UK with conditions.

UK ministers have lobbied for changes since March, with SMMT reporting €80bn annual automotive trade between the UK and EU. Car industry figures support UK inclusion due to integrated supply chains. The policy reversal reflects Europe's balancing act between protectionism and maintaining critical industrial partnerships that support millions of jobs across the continent.