Macron says US climate legislation is ‘not friendly’

French President Emmanuel Macron branded “not friendly” a key piece of US legislation that has triggered concerns in Europe over the impact of billions of dollars in incentives for renewable energy companies.

Macron made his remark in front of about 50 business leaders representing some of France’s most polluting companies, including cement maker Vicat SA, steel maker ArcelorMittal SA and energy giants TotalEnergies SE and Exxon Mobil Corp. 

“The US produces cheap gas and in addition rolls out massive state aid schemes,” Macron said Tuesday, referring to the US Inflation Reduction Act, which among other provisions offers subsidies for electric cars made in North America. “I think this does not comply with the rules of the World Trade Organization and I think it is not friendly.”

Macron said he would tackle the issue during his state visit to Washington in early December and renewed his plea for a so-called Buy European Act -- without defining what this would entail.

Macron has previously voiced concerns that US trade and energy policies which allow the government to sell natural gas at lower prices will affect business investment decisions. Macron also wants the industrial sector to halve its greenhouse gas emissions within a decade, an adviser said.

The meeting took place just after Macron’s return from the COP27 climate conference in Egypt, as France balances the pledge to cut net emissions of greenhouse gases with the need to keep businesses in Europe. 

The companies invited to the presidential palace represent 54% of France’s industrial greenhouse gas emissions, and also 30,000 jobs, according to Macron’s office. 

The conundrum between protecting business and cutting emissions is especially apparent in the car sector, one of France’s most important industries, including Peugeot-maker Stellantis NV, Renault SA and their suppliers. While the EU recently reached a deal to effectively ban new combustion-engine cars from 2035, French officials back a 2026 review clause to assess the impact that the EU’s push toward all-electric cars is having on jobs and the cost of vehicles.