“European foundries at a turn­ing point”: inter­view with Ain­hoa Ondarzabal

Dur­ing the FEAF Gen­eral Assembly held in Spain, EFF Sec­ret­ary Gen­eral Ain­hoa Ond­ar­za­bal addressed the major indus­trial and reg­u­lat­ory chal­lenges cur­rently shap­ing the future of European foundry. From ETS reform and CBAM to indus­trial policy, energy costs and stra­tegic autonomy, the dis­cus­sion focused on the European dossiers that will define the sector’s com­pet­it­ive­ness and decar­bon­isa­tion path­way in the years ahead.

Key takeaways:

• The reg­u­lat­ory frame­work shap­ing the next dec­ade of European foundry is being nego­ti­ated now.
• Decar­bon­isa­tion and indus­trial com­pet­it­ive­ness must advance together.
• European foundry must be recog­nised as a stra­tegic elec­tro-intens­ive sec­tor in its own right.
• ETS and CBAM must remain aligned to avoid car­bon leak­age and cumu­lat­ive expos­ure.
• National asso­ci­ations play a decis­ive role in shap­ing European indus­trial policy.

Q1. For those who may not know it well, what is EFF and what role does FEAF play within it?

First of all, thank you for the invit­a­tion. It is a pleas­ure to be here today at the FEAF Gen­eral Assembly.

The fed­er­a­tion was foun­ded in 1953, but for dec­ades it was hos­ted and man­aged by the Ger­man national asso­ci­ation and had a more tech­nical than polit­ical pro­file. A couple of years ago, the board decided to change that: to evolve the organ­isa­tion so that it could truly pos­i­tion the sec­tor before the European insti­tu­tions. That decision became con­crete in April 2025, when the Gen­eral Sec­ret­ariat was cre­ated and I joined the project.

Today, EFF brings together twenty national foundry asso­ci­ations from across Europe. FEAF is one of them, and also one of the five asso­ci­ations with the greatest weight at the European table, together with the Ger­man, Italian, French and Pol­ish asso­ci­ations. It is import­ant to under­line that when the fed­er­a­tion builds the European pos­i­tion of the sec­tor, the voice com­ing from Spain is one of the most influ­en­tial around the table.

And why does EFF exist? Because in Brus­sels, act­ing alone does not work. The Com­mis­sion, Par­lia­ment and Coun­cil do not nego­ti­ate with indi­vidual com­pan­ies, nor gen­er­ally with isol­ated national asso­ci­ations. They need European inter­locutors cap­able of provid­ing sec­tor-wide data and coordin­ated pos­i­tions. That is what we do.

And there is some­thing import­ant to say about the way we work: European pos­i­tions are built through the act­ive par­ti­cip­a­tion of the national asso­ci­ations. Their involve­ment is essen­tial to build­ing a con­sen­sual sec­tor pos­i­tion that reflects the needs of each coun­try. When national asso­ci­ations par­ti­cip­ate and con­trib­ute, EFF can go fur­ther. When a national asso­ci­ation dis­con­nects, we lose col­lect­ive strength.

Q2. What kind of moment is the European foundry industry going through right now?

I have found a sec­tor that is going through a very dif­fi­cult period. Truly dif­fi­cult years.

And I want to explain what kind of dif­fi­culty this is, because it mat­ters. Foundry has gone through dif­fi­cult peri­ods before — it is an industry used to cycles. But what we are facing now is not just another down­turn. It is dif­fer­ent. It is structural.

Why? Because sev­eral prob­lems are hit­ting the foundry industry at the same time. Any one of them, indi­vidu­ally, the sec­tor would know how to man­age. The prob­lem is that they are all arriv­ing sim­ul­tan­eously. And together, for many com­pan­ies, they have become a mat­ter of sur­vival. This is what we call the per­fect storm.

What are those chal­lenges? Energy costs, much higher in Europe than in the coun­tries we com­pete with. Asian imports enter­ing under unfair con­di­tions. The cumu­lat­ive weight of reg­u­la­tion. A green trans­ition mov­ing faster than indus­trial real­ity allows. And weak demand, with invest­ment frozen.

That said, on the point of reg­u­la­tion I want to make an import­ant dis­tinc­tion, because it is the key to this moment. It is true that the accu­mu­la­tion of reg­u­la­tion weighs heav­ily. But not every reg­u­la­tion cur­rently on the table is a bur­den. Some of the meas­ures now being nego­ti­ated are actu­ally designed to solve prob­lems. The new regime address­ing steel over­ca­pa­cit­ies tackles unfair com­pet­i­tion. And the Indus­trial Accel­er­ator Act rep­res­ents Europe’s attempt to rein­dus­tri­al­ise, regain com­pet­it­ive­ness and strengthen stra­tegic autonomy.

That is why this moment is decis­ive. All of these reg­u­la­tions are being nego­ti­ated right now. The texts can still be changed. Once a European reg­u­la­tion enters into force, there is no going back — but at this stage it is still pos­sible to influ­ence the out­come. That is why I say that the next dec­ade of the sec­tor is being writ­ten in these months. The moment is now. Not in two years. Now.

Q3. You talk about pos­i­tion­ing the sec­tor. If you had to sum­mar­ise in one sen­tence the mes­sage EFF is bring­ing to Brus­sels, what would it be?

Foundry is a stra­tegic elec­tro-intens­ive sec­tor in its own right. It is not merely a sup­plier. It is an indus­trial sec­tor with its own tech­nical, eco­nomic and envir­on­mental identity.

When the Com­mis­sion designs indus­trial policy, it iden­ti­fies stra­tegic sec­tors and assigns them instru­ments: accel­er­a­tion zones, fund­ing, pref­er­en­tial cri­teria in pub­lic pro­cure­ment. If foundry appears on that list, it gains access to those instru­ments. If it is diluted as an annex of another value chain — steel, auto­mot­ive — then it loses access to the very tools cre­ated by the reg­u­la­tion itself.

So, dossier after dossier, our under­ly­ing request is always the same: sec­toral recog­ni­tion, an iden­tity of its own, and expli­cit inclu­sion. We are not ask­ing for spe­cial treat­ment. We are ask­ing for recog­ni­tion of what foundry already is.

Q4. What is cur­rently at stake in terms of costs?

Let us speak clearly: today European foundry is racing against the clock under rules that are not entirely fair. And if we talk about costs, we must talk about the price of car­bon. Car­bon pri­cing is struc­tured around two mech­an­isms, which I will explain sep­ar­ately: ETS and CBAM.

ETS

You already know the essen­tials of the ETS: Europe puts a price on car­bon, and the foundry sec­tor has been pay­ing it since 2005. Every year com­pan­ies receive free emis­sion allow­ances, and the num­ber they receive is cal­cu­lated through bench­marks based on the most effi­cient install­a­tions in the sector.

And there are cur­rently three key issues at stake.

Bench­marks.
The prob­lem is that a single bench­mark value derived from the most effi­cient install­a­tions pen­al­ises entire sub­sect­ors: foundry is extremely het­ero­gen­eous — dif­fer­ent metals, pro­cesses and com­pany sizes — and its tech­nical real­ity can­not be cap­tured by a single number.
And tim­ing is tight: the new bench­marks are being defined right now and will be adop­ted at the end of June. What we are ask­ing for is recog­ni­tion of that specificity.
The good news is that a broader ETS reform is com­ing in July, and this should open the door to sec­tor-spe­cific bench­marks more closely adap­ted to foundry real­it­ies. That is our real opportunity.

The phys­ical bar­ri­ers to decarbonisation.
Redu­cing emis­sions means repla­cing cupola fur­naces with elec­tric induc­tion fur­naces, but this col­lides with real lim­its: induc­tion fur­naces require huge amounts of elec­tri­city that local grids often can­not provide, and many foundries are loc­ated in urban areas with no room for expan­sion. We are not res­ist­ing decar­bon­isa­tion: we are ask­ing that timelines do not impose phys­ic­ally impossible tar­gets, because for­cing them simply leads to closures.

The asym­metry with CBAM.
Free allow­ances are being pro­gress­ively phased out until dis­ap­pear­ing entirely in 2034, based on the logic that CBAM will provide bor­der pro­tec­tion. But CBAM still does not cover fin­ished cast com­pon­ents. This means that for sev­eral years the sec­tor will lose internal pro­tec­tion before obtain­ing external pro­tec­tion — and for an elec­tro-intens­ive sec­tor exposed to inter­na­tional trade, that is a recipe for relo­ca­tion. EFF’s pos­i­tion is for­mu­lated very clearly: sequen­cing, not oppos­i­tion. We are not ques­tion­ing cli­mate object­ives, nor ask­ing to slow decar­bon­isa­tion. We are ask­ing that the phase-out of free allow­ances fol­lows the real pace of CBAM deploy­ment. This is reg­u­lat­ory coher­ence, not lower cli­mate ambition.

CBAM

To pre­vent ETS from becom­ing a boom­er­ang — where pro­duc­tion moves abroad and Europe ends up import­ing the same products from pro­du­cers who do not pay for car­bon — Europe cre­ated CBAM: if a European com­pany pays for its emis­sions, a for­eign com­pany export­ing to Europe must pay an equi­val­ent cost at the bor­der. Without that mech­an­ism, Europe would simply have expor­ted its emissions.

The prob­lem is that CBAM is applied asym­met­ric­ally. It taxes the fer­rous raw mater­i­als that foundries import and can­not replace — start­ing with pig iron — as well as primary alu­minium. But it still does not tax fin­ished cast com­pon­ents com­ing from India, Tur­key, China or other Asian countries.

The res­ult is that European foundries pay car­bon costs twice — domest­ic­ally and on impor­ted raw mater­i­als — while fin­ished com­pon­ents enter­ing from abroad pay noth­ing. We call this cumu­lat­ive exposure.

EFF’s action is struc­tured along three par­al­lel lines: bring­ing data to Brus­sels prov­ing that these raw mater­i­als have no European altern­at­ive, in order to request either their exclu­sion or a trans­itional mech­an­ism; secur­ing broad inclu­sion of foundry products when CBAM is exten­ded to fin­ished com­pon­ents; and ensur­ing align­ment between ETS and CBAM.

Q5. Let us talk about inter­na­tional com­pet­i­tion. There is a spe­cific reg­u­la­tion on steel over­ca­pa­cit­ies. How does it affect the sector?

This is prob­ably the least known dossier out­side the sec­tor, but one of the most import­ant in terms of trade com­pet­i­tion: the regime address­ing steel overcapacities.

For years Europe has pro­tec­ted itself through safe­guard meas­ures against struc­tural over­ca­pa­cit­ies in the global mar­ket — par­tic­u­larly from China, India and other Asian coun­tries, which pro­duce far bey­ond their domestic demand and redir­ect the sur­plus onto European markets.

The cur­rent safe­guard regime is expir­ing, and the Com­mis­sion has presen­ted the sys­tem that will replace it: reduced quotas, higher tar­iffs, and the “melt and pour” rule, which requires prov­ing where the mater­ial was melted and cast, not only where it was last trans­formed. For the steel industry, the design is mov­ing in the right direction.

The prob­lem for foundries is that the reg­u­la­tion cov­ers steel and basic forms — sheets, coils, pro­files, tubes — but not fin­ished cast com­pon­ents. Asian over­ca­pa­cit­ies there­fore con­tinue enter­ing Europe, simply trans­formed into fin­ished products and com­pon­ents. Exactly what foundries produce.

The good news is that the reg­u­la­tion opens three pos­sible path­ways to revise its scope, and foundry products could fit within the inter­me­di­ate route. But the win­dow to build the case is short: it closes in the autumn of this year.

And we are not alone — dozens of sec­tors have already expressed interest, which means we must present a strong and cred­ible case.

That case has two dimen­sions: an evid­ence-based dossier demon­strat­ing with data the dam­age imports are caus­ing to European foundries; and polit­ical pos­i­tion­ing work before the Com­mis­sion, Par­lia­ment and Council.

It is a demand­ing dossier — tech­nic­ally com­plex and costly — and we are cur­rently assess­ing its feas­ib­il­ity together with our members.

Q6. We have dis­cussed costs, com­pet­i­tion and oper­a­tions. But there is also the day-to-day real­ity of run­ning a foundry — emis­sions, dis­charges, noise, energy…

Yes, this is the most tech­nical dossier, but also the one that affects the daily life of a plant the most. Let me explain it simply.

When a foundry oper­ates in Europe, it holds an envir­on­mental per­mit that defines what it can emit, dis­charge and how it man­ages waste and energy. Those con­di­tions are defined by a European dir­ect­ive, which each coun­try then trans­poses into national law.

And because each sec­tor is dif­fer­ent, Europe also pub­lishes sec­tor-spe­cific tech­nical ref­er­ence doc­u­ments — one of them ded­ic­ated to foundry — that define accept­able tech­niques and values.

Right now, three things are mov­ing simultaneously:

The gen­eral Indus­trial Emis­sions Dir­ect­ive (IED), revised in 2024

The foundry BREF, with con­clu­sions pub­lished in Decem­ber 2024

And the Envir­on­mental Omni­bus, a Com­mis­sion pack­age from Decem­ber 2025 intro­du­cing more flex­ib­il­ity into the most rigid ele­ments of the dir­ect­ive, cur­rently under nego­ti­ation in Parliament.

This is where the cost of oper­at­ing a foundry in Europe for the next fif­teen years is being decided. And the timeline is very close: exist­ing foundries will need to revise their per­mits before the end of 2028.

What we are cur­rently work­ing on are the amend­ments to the Envir­on­mental Omni­bus. The dir­ec­tion of greater flex­ib­il­ity is pos­it­ive, but the pro­posal still needs to pass through Par­lia­ment and Coun­cil, and along that path it could be diluted.

Our work is to ensure it reaches the fin­ish line in the strongest pos­sible form. And for our amend­ments to carry European weight, we will col­lect con­tri­bu­tions from our mem­bers on which exemp­tions and adjust­ments are real­istic in each country.

The trans­pos­i­tion of the dir­ect­ive into national law remains in the hands of the national associations.

Q7. We have dis­cussed costs, com­pet­i­tion and oper­a­tions. But surely it is not all bad news. Is there any­thing positive?

For the first time in a dec­ade, Europe has decided to pur­sue ser­i­ous indus­trial policy: put­ting pub­lic money into pro­du­cing in Europe rather than import­ing from elsewhere.

That decision has a name: the Indus­trial Accel­er­ator Act, presen­ted in March of this year. Exec­ut­ive Vice-Pres­id­ent Séjourné, who presen­ted it, described it as a genu­ine shift in Europe’s eco­nomic doctrine.

For the first time, Europe has set a quan­ti­fied object­ive: increas­ing the share of man­u­fac­tur­ing industry from today’s 14% of GDP to 20% by 2035.

And this trans­lates into real money through three pillars:

pub­lic pro­cure­ment with European and low-car­bon preference;

strengthened con­trol of for­eign invest­ments in stra­tegic sectors;

and sup­port for decar­bon­isa­tion through accel­er­ated indus­trial zones.

How does this affect foundry, and what are we doing about it? Four things, all under nego­ti­ation right now:

The list of stra­tegic sec­tors in Annex 2.
Steel, alu­minium, auto­mot­ive and net-zero tech­no­lo­gies are included. Foundry, by name, is not. And in a reg­u­la­tion that will mobil­ise bil­lions of euros, being excluded from that list means being excluded from the instru­ments it cre­ates. We are work­ing to secure expli­cit inclu­sion of foundry as a stra­tegic elec­tro-intens­ive sector.

The defin­i­tion of “European”.
A min­imum per­cent­age of loc­ally pro­duced con­tent must be high enough so that a com­pon­ent merely assembled in Europe, but man­u­fac­tured else­where, can­not be labelled European. This is a safe­guard for the European con­tent already embed­ded in our products. We are work­ing to ensure that threshold provides real pro­tec­tion, not merely sym­bolic protection.

How car­bon foot­print is cal­cu­lated to define “low-car­bon”.
If the meth­od­o­logy is too strict, foundries invest­ing in decar­bon­isa­tion could be excluded from the very sup­port schemes designed for that trans­ition. That would be a con­tra­dic­tion. We are ask­ing for meth­od­o­lo­gies that recog­nise the trans­ition path­way under­way, not only the final destination.

Indus­trial accel­er­a­tion zones.
Each coun­try will des­ig­nate at least one, with fast-track per­mit­ting and pri­or­ity access to energy and financing.

For us, this is a huge oppor­tun­ity, because elec­tric induc­tion requires major grid capa­city. And this is not decided in Brus­sels — it is decided in Mad­rid. Our work is car­ried out together with national asso­ci­ations — FEAF among them — so that foundry clusters become pri­or­ity candidates.

Q8. You have described five very dif­fer­ent fronts. How does EFF organ­ise itself to handle all this in parallel?

At EFF, we organ­ise our work through them­atic work­ing groups, one for each dossier. These are not gen­eral dis­cus­sion for­ums: they are the spaces where tech­nical pos­i­tions are built before being brought to the European institutions.

Each group is nour­ished by indus­trial expert­ise and the data provided by the mem­ber asso­ci­ations. The qual­ity of what comes out of Brus­sels depends dir­ectly on the qual­ity of what comes into these groups.

We also main­tain two sec­toral sec­tions by value chain: auto­mot­ive, par­tic­u­larly rel­ev­ant given the scale of trans­form­a­tion under­way in the auto­mot­ive industry; and rolls, which has its own spe­cific dynam­ics and challenges.

Then there is the internal gov­ernance struc­ture, organ­ised around:

the Coun­cil, meet­ing at least once a year;

the Board;

the Man­age­ment Com­mit­tee, meet­ing quarterly;

and the Sherpa group, con­vened whenever oper­a­tional needs require it.

Q9. You paint a demand­ing pic­ture. What do you need from this room? What does EFF need from national asso­ci­ations such as FEAF?

Three things, and I will be very concrete.

Inform­a­tion and data.
When an EFF work­ing group launches a request for inform­a­tion from the sec­tor — import data, cost data, evid­ence on reg­u­lat­ory impact — dead­lines are short and qual­ity mat­ters. Every time Span­ish data is miss­ing, the European case becomes weaker. When it arrives on time and well struc­tured, we gain strength. This is the most con­crete con­tri­bu­tion this room can make start­ing tomorrow.

Polit­ical pres­ence in Madrid.
Brus­sels is not a sep­ar­ate planet. What is decided in each dossier also depends on the pos­i­tions defen­ded by each Mem­ber State in the Coun­cil. And that work is built in every national cap­ital. It is import­ant to main­tain con­tacts with min­is­tries of Industry, Envir­on­ment and Trade. The coordin­ated action between what EFF defends in Brus­sels and what FEAF defends in Mad­rid mul­ti­plies the strength of both.

Span­ish Mem­bers of the European Parliament.
There are Span­ish MEPs in the European Par­lia­ment who can play a decis­ive role — if we identify them and engage with them early enough.

Identi­fy­ing them, present­ing the sec­tor to them and main­tain­ing open chan­nels of com­mu­nic­a­tion: this is not the work of the European fed­er­a­tion. It is the work of the national asso­ci­ation. And it pro­duces res­ults quickly.

Q10. To con­clude: if you had to leave this room with one single idea, what would it be?

The idea I would like to leave you with is very simple.

For dec­ades, European foundry did not have its own iden­tity in Brus­sels. It was seen as an annex: an annex of steel, an annex of auto­mot­ive, an annex of oth­ers. That is changing.

For the first time in a long time, European insti­tu­tions are begin­ning to look at foundry for what it truly is:

a stra­tegic sector;

elec­tro-intens­ive;

integ­rated into crit­ical value chains;

cap­able of decar­bon­ising if the con­di­tions allow it;

and abso­lutely irre­place­able for Europe’s indus­trial autonomy.

But that recog­ni­tion does not build itself. It is built together with the national asso­ci­ations, con­trib­ut­ing indus­trial data and expert­ise, car­ry­ing our pos­i­tions to Brus­sels through EFF and to national min­is­tries through the national associations.

In other words: it is built with you.

What is decided in the com­ing months will shape the con­di­tions of the sec­tor for the next dec­ade. And you are at the centre of that work.