EU regulators to probe aid for Porsche Macan project
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EU competition regulators will examine whether a 522 million euro ($640 million) project to build the Porsche Macan small SUV gives the German carmaker an unfair advantage, in breach of EU state aid rules.
The European Commission opened an in-depth investigation on Wednesday, saying it was necessary because of the high market shares of Porsche and its part-owner Volkswagen.
"The Commission will check whether the aid is necessary and proportionate to provide an incentive for the investment and whether its contribution to regional development outweighs the distortion of competition," the EU regulator said in a statement.
The project in Leipzig, in the east of Germany, will start building the Porsche Macan by 2014. German authorities will provide a direct grant of 43.67 million euros and an investment premium.
German authorities notified the EU regulator of the proposed aid in December last year.
The EU investigation doesn't change Porsche's plans to produce the car in Leipzig, said Hans-Gerd Bode, a spokesman for Porsche AG. "The construction work has already started and if the grant is not approved, we will pay for it ourselves," Bode said.
Volkswagen will buy up the remaining half of Porsche it does not already own, it announced last week.
Reuters and Bloomberg contributed to this report
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