An in-depth investigation was opened by the European Commission last Wednesday on a project that produces the Porsche Macan small SUV. The EU competition regulators will be checking if this 522 million euro ($640 million) project represents an unfair advantage and violates EU state aid regulations.
The European Commission said that the investigation is required due to the high market shares of Porsche and Volkswagen.
In a statement, the EU regulator said that they will examine if the aid was necessary and proportionate to offer an incentive for the investment and whether the benefit to regional development has a more significant weight than the distortion of competition.
According to the plan, the Porsche Macan will have to start production by 2014 in Leipzig, in the east of Germany. The authorities said that they will offer 43.67 million euros and an investment premium as a direct grant.
They had informed the EU regulator about the aid they’re proposing in December 2011. Hans-Gerd Bode, a spokesman for Porsche AG, said that this probe doesn't change Porsche's plans to make the car in Leipzig.
Bode said that the construction work has already begun and so if the grant is not provided, he will have to figure out how to pay these features. Last week, Volkswagen announced that it will purchase the remaining half of Porsche it does not yet own.