Market of‘Automotive Europe is going through a very difficult time. A series of factors have led to a sudden decline in car sales, most notably that Electric The crisis has forced major European car manufacturers to rethink part of their business models, making up for lost profits through savings and cost-cutting due to the reduced margins guaranteed by BEVs in their fuel-based vehicles. compared to positions. Gas
It was the first to give up and close the factory. volkswagen, which appears poised to embark on a path of group rationalization, increasingly resembling corporate restructuring. too Ford e Mercedes However, they have announced major layoffs and staff cuts across the continent. Stellar For the moment it has not fired any employees yet, but the use of layoffs in Italy has been significant. And the crisis has already claimed its first victim: North Volt.
Causes and Consequences of the Automotive Crisis in Europe
From the beginning of 2024, the car market in Europe is facing difficulties. coincides with the onset of the crisis Abolition of major concessions which emphasized the purchase of not only electric vehicles for 2022 and 2023; Many governments expected that after initial aid, consumers would respond to offers from manufacturing companies Environmental transition Towards hybrids and electrics. However, sales initially stagnated, and then began to decline.
Inflation, uncertainty about performance Electric cars And the coverage of supply networks and Chinese competition have been central factors in the crisis, causing deep concern even for major automotive groups. Under pressure from the EU’s increasingly strict rules, European car companies could not produce products that could compete in price or appeal with Chinese companies or Tesla. Thus the market stalled and companies started cutting to cover their losses.
Volkswagen’s big cut.
The first major automotive company to act decisively was Volkswagen. The Brussels plant, where the models were manufactured, paid the price. Audi, Definitely closed from February 2025. But that was just the first step: the goal is to save. 5 billion euros And neither layoffs nor plant closures are ruled out in Germany.
According to the management, the main issue will be the cost of labour. Even if the group has reduced the weight of this expense item from 18.2% to 15.4% of turnover in a single year between 2022 and 2023, this figure is much higher than that of its competitors. , which is not more than 11%. So layoffs are on the rise, but German unions are moving to avoid them. In fact, Volkswagen workers would like to present a plan to management. Salary reduction Volunteered to save factories in Germany.
Layoffs for Ford and Mercedes
The car market crisis in Europe has also affected foreign companies, e.g Ford The American giant, unable to compete with Tesla on electric cars in the US, has announced cuts. 4 thousand jobs in its factories in Germany and the UK. In announcing the decision, he criticized London and Brussels for not having a real long-term plan for sustainable mobility and that it was compromising the car industry.
The crisis continues in Germany as well. Mercedes Announced drastic spending cuts to make up for recent lost revenue. The talks with the German giant were pretty vague, but we’re talking about it. Several billion Production declines each year, an expression that unions fear could lead to mass layoffs like those announced by Ford or the closing of some plants.
Stellants situation
In large European companies, Stellanty. He is taking a different approach. For the moment, he has never criticized the European climate change plan. On the contrary, CEO Carlos Tavares has always said that the company will respect the obligations imposed by Brussels. The only criticism leveled at the governments of individual member states is the lack of incentives for the purchase of electric cars. Even when it comes to cutting costs, Stellantis is taking a different route.
The company has not announced any restructuring plans in Europe and is instead looking to keep plants open, particularly in countries where its best-known brands originate from Italy and France. However, difficulties persist, as evidenced by nearly a year of layoffs and reduced hours. Mirafury And the recent decision to ask for an extra week of redundancy in December for the factory Termoli
La Prima Vitama: North Volta
However, the crisis in the automotive sector has already taken its first toll. The Swedish company, also based in the US, Northvolt has actually asked for it. Chapter 11Extraordinary administration for companies in great difficulty to resolve their debts in force in the United States. NorthVault was left with less than 30 million euros of liquidity compared to more. 5 billion loan. For months he had been trying to get financing, but it came neither from the Swedish government nor from the big car companies, which were his main investors.
The period of the North Volt is infiniti condita High hopes for European Electric. It would have to compete with Tesla and Chinese companies on the lithium batteries that power electric cars. Several major European conglomerates believed in the project, led by two former Tesla managers, who built their first factory in Sweden, far above the Arctic Circle. However, the collapse of the market made it impossible to realize the initial plans.
The idea of selling batteries to major European automotive companies was scrapped when it became clear that sales of BEVs, especially battery-powered vehicles, would not recover volumes through 2024. In crisis, the same companies that had invested. North Volt They refused to provide more money to keep it afloat. Forced to interrupt the research and development phase, the Swedish company tried to focus on production, but without success.
