Employment cuts: An analysis conducted by the European Automotive Parts Manufacturers Association (CLEPA) for the Financial Times indicates that in 2024, European suppliers they reduced twice as many jobs as in the previous year. In 2023, the number of jobs in the industry decreased by 15,000, and in 2024 – by over 30,000. During the same period, the pace of job creation decreased. CLEPA analysis indicates that from 2020 the number of full-time jobs in the European automotive market will increase decreased by a total of 58 thousand. Automotive parts manufacturers employ approximately 1.7 million workers across the European Union.
Thousands of workers at risk: Sales of new vehicles in the European market are constantly declining, which is one of the effects pandemic COVID-19, war in Ukraine and inflation. The largest companies in the industry announced last year significant reductions employment. Forvia, which employs over 75,000 people in Europe, plans to close down by 2028 10 thousand jobs. Ford also intends to reduce 4,000 jobs in Europe. In recent months, decisions about closing two factories in France announced Michelin, and Volkswagen plans to liquidate three plants in Germany.
A difficult moment: “The Guardian” points out that the decline in profits of automotive concerns occurred at a difficult time when companies are trying to find money for expensive transition to electric vehicles. The European Commission announced that in 2025 tighten the regulations regarding carbon dioxide emissions for car manufacturers, which was met with protests from industry representatives. All the more so because, as analyst Matthias Schmidt points out, interest in electric vehicles is also falling on the European market. Last year theirs sales decreased by 1.4 percent.
Electric cars in Europe: The market situation may be determined relatively high cost this type of vehicles and resignation from subsidieswhich until recently were in force, among others, in Germany. Companies investing in these technologies have not recorded the expected increase in sales, and the CLEPA analysis also indicates that from 2020 number of new jobs related to electric vehicles did not compensate for job cuts related to combustion vehicles.
Ready for dialogue? “The Guardian” points out that European decision-makers may agree with the industry's expectations. European Commission President Ursula von der Leyen is scheduled to start in January “strategic dialogue” on the European automotive industry. Previously o the need to relax the regulations regarding carbon dioxide emissions were spoken by, among others, the Prime Minister of Italy, Giorgia Meloni, and the Chancellor of Germany, Olaf Scholz.
Suppliers are fleeing Europe: However, at the moment some car parts manufacturers are responding to the difficult situation by looking for customers outside Europe. French supplier OPMobility has decided to open factories in the United States and China. – We want to continue to cooperate with our long-term clients, but we have to look for opportunities elsewhere. In the next five years we do not expect significant growth in the European automotive sector, said the company's CEO Laurent Favre.
An opportunity for China: The decline in competitiveness of local suppliers is benefiting, among others, Chinese entrepreneurs who are constantly striving to… increasing its share in the European market. – We estimate that slight increasethat we can see on the European market will remain developed by increased importsespecially Chinese – said Marc Mortureux, director general of the French Platform for Automotive and Mobility (PFA).
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Sources: : Financial Times, The Guardian