The European automotive industry is experiencing a downturn due to reduced sales and profit targets among major manufacturers, with significant job losses projected amid a transition to electric vehicles and tough economic conditions.
The European automotive industry is facing a bleak outlook as several manufacturers report lowered profit targets, raising concerns about a potential crisis in the sector. Major companies such as Volkswagen and BMW have announced cost-cutting measures and reduced sales forecasts, with Stellantis failing to meet its operational margin goals, now projected between 5.5% and 7% for 2024. A combination of high prices, a sluggish economy, and weak demand for fully electric vehicles has created a precarious situation for the industry, threatening around 2.4 million jobs in Europe. The market has seen a significant drop in electric vehicle sales, with only 12.6% of car sales in the first eight months of 2024 being electric, compared to 13.9% the previous year. Challenges include stiff competition from Tesla and Chinese manufacturers, upcoming stringent CO2 regulations, and individual company struggles in key markets like China and North America. Additionally, suppliers like Forvia and Autoliv are also revising downwards their results forecasts amid a stagnant market. While new jobs are expected in battery recycling and mega-factories by 2026, around 65,000 existing jobs are at risk by 2030 due to the transition from diesel to electric vehicles, highlighting a troubling trend in the automotive sector.
The automotive industry in Europe is under significant strain, marked by a recent series of announcements from major manufacturers indicating a downturn in profit expectations. This shift follows several quarters of strong performance, driven by increased vehicle prices and demand post-pandemic. However, economic challenges, along with changing consumer preferences towards electric vehicles, have raised alarms regarding the sustainability of the industry. The market’s ongoing struggles are compounded by the imminent tightening of emissions regulations and the rising competition from both established electric vehicle companies and new entrants in the market.
The current state of the European automotive industry reveals a critical juncture, where major automakers are reevaluating their strategies amid dwindling profits and poor market conditions. As the sector transitions towards electric vehicles, the ramifications include significant job losses and stalled production. While there are future opportunities for growth in new areas like battery recycling, the risks for existing workforce and manufacturers remain pronounced. This situation underscores the automotive sector’s fragility and the pressing need for adaptive strategies to navigate the shifting economic landscape.
Original Source: www.charentelibre.fr
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