EV supplier job losses increase in EU

EUROPEAN vehicle part suppliers are facing a dramatic downturn in production on the back of slower-than-expected electric vehicle (EV) sales across the continent.

In turn, an expected 54,000 redundancies are imminent, with European Association of Automotive Suppliers (CLEPA) reporting job cuts across several of the EU’s largest vehicle parts producers, including the likes of Continental, Robert Bosch, Schaeffler, and ZF Friedrichshafen.

The CLEPA says the number of jobs expected to be lost over the coming two to five years will be greater than those announced in 2020 and 2021 combined.

It says Bosch plans to cut up to 5500 jobs and reduce working hours for as many as 10,000 other employees as it faces lowered demand for EV parts.

Continental, meanwhile, will axe 7150 full-time positions worldwide by the end of this year as it aims to “become more agile”.

For Schaeffler, a reported 4700 jobs will be cut across Europe, including 2800 at its 10 German sites.

Finally, ZF Friedrichshafen will layoff 12,000 staff at its German facilities by the end of the decade as part of a €6.0 billion ($A9.9b) worldwide savings target.

According to a report published by Automotive News Europe this week, European vehicle parts suppliers are struggling against the effects of a faltering economy, high inflation, and “the costly transition to EVs”.

At the same time, escalating energy and production costs are “weakening demand and eating into the competitiveness of European components”.

The CLEPA said European automotive suppliers are under pressure to recover fast or face continued job cuts, potentially jeopardising the industry’s future.

“Unless demand picks up and Europe regains competitiveness, the wave of job losses will continue well into the coming years, leaving the industry and its workforce in a precarious position,” the CLEPA told Automotive News Europe.

The publication reports that EU vehicle production has contracted 20 per cent (or 3.2 million units) from prior to the COVID-19 pandemic. In 2024, production was down 700,000 units on the year prior.

In addition, the CLEPA says EV-related investments fell sharply to €5.64 billion ($A9.3b) in 2024, the lowest since 2019. This follows weaker than anticipated demand for EVs.

Despite optimism that European electric vehicle production will gather momentum towards the end of the decade, the CLEPA says Europe’s automotive suppliers “must remain cautious”.

Already, 65 per cent of CLEPA members say they expect EV market share to remain below 50 per cent by the 2030. Last year EVs accounted for around 14 per cent of overall new vehicle sales in Europe.

Unsurprisingly, the CLEPA said European automotive parts suppliers “struggled to reach profitability in 2024”, with many unable to keep profit margins above the minimum investment threshold of five per cent it deems necessary to continue investment in future technologies.

“While the decline in demand reflects serious structural challenges for Europe’s automotive industry, it also underscores the need to unlock the region’s full potential for mobility innovation,” CLEPA secretary general Benjamin Krieger told Automotive News Europe.

“Access to funding, investment support, and technology-neutral regulation are essential to maintaining Europe’s global leadership in automotive technology.”