Europe’s auto industry: New tech jobs cannot offset massive job cuts
Image: Bosch
The European automotive sector is experiencing a sharp decline in employment numbers. The creation of new jobs in areas such as electrification and software is not enough to offset job cuts at manufacturers and suppliers. This is due to weak production levels and high costs, which reduce capacity.
Automotive News reports, citing the automotive suppliers’ association CLEPA, that European suppliers have announced plans to cut 104,000 jobs in total for 2024 and 2025. 50,000 job cuts occurred in 2025, while only 7,000 new positions were created last year. The sector employs around 1.7 million people in the EU.
Germany, as Europe’s largest automobile producer, is particularly affected. According to the Federal Statistical Office, the number of employees in the country’s automotive industry dropped by 42,300 as of June this year, representing a 5.8 percent decline. With 691,500 jobs lost, it reached the lowest level since 2005.
“Steep downward trend”
In this market, employment among automobile manufacturers fell by 6.1 percent, while it declined by 7.6 percent among suppliers of parts and accessories. Benjamin Krieger, general secretary of CLEPA, told Automotive News that the pace of decline, driven in part by electrification, has surpassed earlier projections. “The direction of the trend is the same everywhere,” said Krieger. “Employment is on a steep downward path.”
There is a shortage of engineers and software specialists among suppliers, which hinders the development of electric, digital, and software technologies and thus slows the creation of new, future-oriented jobs. However, the workforce needed is not sufficient to reverse the overall decline in labor-intensive manufacturing. According to CLEPA estimates, vehicle production in the EU will be 20 percent below 2019 levels by 2025, resulting in a deficit of about 3.1 million vehicles.
Since production is expected to remain largely unchanged this year, suppliers are under pressure to close plants, relocate manufacturing jobs, or cut staff in order to adapt to the shrinking market. Manuel Kallweit of Germany’s automotive industry association VDA described the situation to Automotive News as alarming. He attributed the pressure on already traditionally expensive production in German plants to rising costs, especially for energy, as well as the lack of reforms in taxes and social contributions.
The VDA predicts that under the current regulatory framework, Germany will lose another 125,000 jobs by 2035. Combined with the roughly 100,000 jobs lost since 2019, the total number of employees would be 225,000 below pre-pandemic levels.
Sigrid de Vries of the European Association of Automobile Manufacturers ACEA told Automotive News that new jobs in areas such as battery technology or charging infrastructure cannot automatically offset the loss of traditional positions. Additionally, there is a risk that investments and production capacity may increasingly move out of Europe due to lack of competitiveness.
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About the author
Thomas Langenbucher is an expert in electromobility with professional experience in the automotive industry and finance sector. Since 2011, he has been covering electric vehicles, sustainable technologies, and mobility solutions for ecomento.de. Learn more.
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