The automotive industry is facing a significant upheaval as the transition to electric vehicles fails to deliver on job creation promises. Contrary to optimistic forecasts, according to the European Association of Automotive Suppliers, the sector has shed 86,000 jobs over the past four years.
One key factor behind this trend is the underwhelming demand for electric vehicles in Europe, falling short of inflated projections. The situation is expected to worsen with the EU’s stricter emission targets coming into effect next year, potentially halting production of smaller combustion engine models. This poses a substantial threat to the automotive industry, which accounts for a quarter of Czech manufacturing and over 9% of its GDP.
Major players in the industry are feeling the pinch. Adient, an automotive seat manufacturer, recently announced the closure of two plants in the Czech Republic, resulting in 1,100 job losses over two years. German auto parts maker Schaeffler plans to cut 4,700 jobs across its European factories. Tire giant Michelin is shuttering two factories in France, laying off 1,254 workers, citing deteriorating competitiveness in Europe due to high energy costs.
The transition to electric mobility is not creating jobs fast enough to offset losses in traditional sectors. In the first half of this year alone, European automotive suppliers announced 32,000 layoffs, surpassing even pandemic-era figures. Of the 100,000 new positions promised by 2025 for the electric vehicle transition, only about a fifth have materialized so far.
Industry leaders are calling for regulatory changes to protect jobs and boost competitiveness. Zdeněk Petzl, Executive Director of the Automotive Industry Association, emphasizes the need for competitive conditions and addressing key challenges such as high energy prices and the nearly non-existent European supply chain for electric mobility. As the industry stands at a critical crossroads, the future of automotive manufacturing in Europe hangs in the balance.