The European Commission has approved R&D, environmental and training aid, of ECU 16.1 million, to Opel Austria, a wholly owned subsidiary of General Motors Corp (State Aid No 135/95). The aid will be given to support Opel's proposal to develop a new small-size petrol engine family (family 0), which forms part of a new overall approach to powertrain design. The engine, which is being developed in a 3-cylinder and a 4-cylinder version, will have lower fuel consumption and reduced emissions and would also be more easily recyclable. It will incorporate a completely new generation of an engine management system, making use of highly integrated hybrid chips. It will be used for the present Corsa and Astra models as well as for new small car models under development. The project will be carried out over the period 1994-1998, at a total cost of ECU 375.4 million. Of this amount, ECU 261.4 million concerns normal investment which is not eligible for aid. Total eligible expenditure is, therefore, ECU 114 million, for which a total of ECU 16.1 million of aid is foreseen. In approving the State aid for R&D expenditure, the Commission concluded that the project complies with the criteria for R&D aid set out in the Framework on State aid to the motor vehicle industry and the Framework on State aid for R&D, since the product and process development expenditure is genuinely innovative on a European level and the aid intensities remain within the limits foreseen in the Community guidelines. The innovative character of the engine lies in the need to combine a great number of different and often non-related technologies to compensate for the inherent handicaps of a 3-cylinder layout. Its introduction carries a considerable risk with regard to its smoothness and balance and thus market acceptance. Various elements of the production process also have to be considered innovative on a European level and involve considerable risks for the company as to their efficiency and practicability. The Framework on State aid to the motor vehicle industry also accepts aid for general pollution control, in line with Community guidelines on State aid for environmental protection. As the investment in new cleaning and washing processes for the engine components lead to a significant reduction in effluent emission, and to the recycling of these effluents, and either go beyond national standards or are voluntary measures in the sense that no standards exist, the proposed aid intensity of 30% is within the limits foreseen by the guidelines. In relation to the development of new products and production processes and the introduction of a new assembly work structure, the project foresees measures for training of the company s workforce. In view of the innovative nature of the project, it is considered that the vocational training measures will correspond to genuinely qualitative changes in the required skills of the workforce. The basic training elements are not company specific. On this basis, and since the level of aid is within reasonable limits, the proposed aid for training is considered acceptable according to the rules on aid for vocational training as specified in the Framework on State aid to the motor vehicle industry.