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BOE-A-2026-14115 ·30 June 2026 ·orden Low impact
Tax

Vehicle manufacturing companies: 1 month to maintain RED Mechanism active until December 31, 2026

The PJC/654/2026 Order extends until December 31, 2026, the activation of the RED Mechanism for vehicle manufacturing, previously activated by the Council of Ministers Agreement of December 23, 2024 (art. 47 bis of RDL 2/2015). This mechanism allows labor flexibility and employment stabilization. The extension takes effect from July 1, 2026, and companies must maintain activation throughout the period until December 31, 2026.

In 2 key points

  1. Extension of the RED Mechanism until 31 December 2026 (art. 47 bis del RDL 2/2015)
  2. Activation of the mechanism from 1 July 2026 (Orden PJC/654/2026)

How it affects those involved

For manufacturers in the motor vehicle sector, a key tool for managing working hours and preventing dismissals remains in place. Labour authorities and advisors must monitor compliance with the mechanism during the extended period. Workers may benefit from flexibility in working hours, without any changes to basic rights. Companies that fail to keep the mechanism active could face sanctions for breaching the employment stabilisation regime.

Lifecycle

2026-06-30PublishedPublished in the BOE
2026-07-01Into forceComes into force (Orden PJC/654/2026)
Official text Based on BOE data (boe.es). Information, not advice.

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This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
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