The car industry across the European Union employs over thirteen million people, both directly and indirectly, that’s around six percent of the bloc’s workforce. But in recent years, Europe’s manufacturers have been struggling to cope with issues like economic downturns, clean energy requirements and the digital revolution. Some of the oldest, biggest carmakers are considering plant closures and job cuts in order to try and stay afloat. They are also facing fierce competition in the electric vehicle market from China, who have taken a lead in producing cars that are much more competitively priced and equipped with much more sophisticated technology. China’s own economy has been flagging, so the EU provides it with its largest overseas market in terms of the electric car industry. But now, in a bid to protect their own car industry, the EU has introduced tariffs on electric cars made in China. These tariffs are set to rise from ten percent up to forty five percent for the next five years. Beijing has condemned them as protectionist and there are concerns that it could spark a trade war between Brussels and Beijing. So, on this week’s Inquiry, we’re asking ‘Is Europe’s car industry at a crossroads?’ Contributors: Carsten Brzeski, Global Head of Macro Research, ING, Germany Tu Le, Founder and Managing Director, Sino Auto Insights, United States of America Beatrix Keim, Director, CAR Centre for Automotive Research, Germany Stefan Deix, Director, EUCAR, European Council for Automotive R&D, Belgium Presenter: Tanya Beckett Producer: Jill Collins Researcher: Matt Toulson Editor: Tara McDermott Technical Producer: Matthew Dempsey Production Co-ordinator: Liam Morrey Image Credit: Westend61 via Getty Images
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Welcome to the Inquiry with me, Tanya Beckett.
One question for expert witnesses and an answer it was an announcement that held few surprises for those who've been watching the slow unraveling of Europe's car industry, but a huge blow nonetheless for the many thousands of workers in the sector.
Europe's biggest carmaker, Volkswagen, said it was looking at closing at least three of its plants in Germany, with the loss of thousands of jobs and 10% pay cuts for remaining workers the first time it had shut down a factory on domestic soil Its nearly 90 year history.
Only a few weeks passed before another sign emerged that automakers had pretty much entered a crisis.
Stellantis, the owner of Vauxhall, Peugeot and Citroen, announced it is to close its 120-year-old plant in the UK in April.
Directly and indirectly.
The European Union's automotive industry employs over 13 million people, 6% of the block's workforce and accounts for around 7% of the region's economy.
But the sector has been beset by problems, only one of which is fierce competition from China.
This week on the inquiry we're asking is Europe's car industry at a crossroads?
Part 1 the Manufacturing Landscape.
Car Smeski Global, head of Macro Research at ING.
Europe's car making struggles began nearly a decade ago when the region's largest auto manufacturer became embroiled in a scandal over vehicle emissions.
The debacle cost Volkswagen over $30 billion in fines and compensation.