As Volkswagen pushes ahead with plans to cut 100,000 jobs, a new forecast warns that nearly half of all automotive industry positions in Europe could disappear within the next decade or so.
The Fraunhofer Institute for Labor Economics and Organization projects that employment across the automotive sector — including parts suppliers — could fall by 375,000 jobs by 2030, 660,000 by 2035, and 726,000 by 2040, according to Yonhap.
The European automotive industry employed about 1.6 million people last year. If the projections hold, the sector would shed 45 percent of its workforce by 2040.
Europe's automakers face a deepening crisis as they lose ground to Chinese competitors and fall behind on the shift to electric vehicles, leaving them vulnerable to losing their home market. According to consulting firm EY, the EU's automotive exports to China totaled 16 billion euros ($18.3 billion) last year, while imports from China reached 22 billion euros — marking the first-ever trade deficit in the sector.
German business daily Handelsblatt, citing Chinese customs data, reported that China's auto exports surged about 73 percent year-on-year in June to about 1.06 million units, breaking the 1 million mark on a monthly basis for the first time. The Fraunhofer Institute warned that "without countermeasures, Europe risks becoming permanently dependent on third countries for key technologies."
In Germany, Europe's largest auto-producing nation, parts suppliers were the first to cut jobs as the industry shifted toward electric vehicles. More recently, finished-vehicle manufacturers have also begun restructuring their workforces to address overcapacity and reduce costs.
Volkswagen Group, which had already announced plans to eliminate 35,000 jobs in 2024, is now drawing up an additional restructuring plan to cut up to 100,000 employees — about 15 percent of its global workforce — and to lease or sell its labor-intensive German factories to defense companies and other buyers. BMW is also in negotiations with its union over workforce reductions.
Germany's Federal Statistical Office reported that automotive sector employment stood at 721,400 at the end of the third quarter last year, down 6.3 percent from a year earlier — the lowest level since the second quarter of 2011, when it was 718,000.
woo@heraldcorp.com
