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European carmakers risk insignificance E15.cz

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Although double-digit declines in sales and sales are affected by the global decline in demand caused by the coronavirus pandemic, the black outlook is exacerbated by the fact that the poor condition of European carmakers was talked about a few years before the crisis. Proof of this is the fact that the Association of European Automobiles ACEA announced at the beginning of the year that a year-on-year decline in sales can be expected this year. The reason was to be a decline in interest in new cars, a limited offer and an increase in prices.

“The coronavirus pandemic has paralyzed the industry. However, it is difficult to estimate to what extent the current figures are affected by deferred consumption and to what extent this is a more permanent trend, ”says Zdeněk Petzl, Executive Director of the Association of the Automotive Industry (AutoSAP).


The reason for the long-term unhappy results is the ever-tightening emission limits for cars, which requires manufacturers to use more environmentally friendly and thus more expensive technologies. From next year, according to EU rules, average car emissions should fall from the current 135 to 95 grams of carbon dioxide per kilometer, ie by thirty percent. By 2030, European regulations are demanding a further reduction of 37.5 percent, which, according to experts, can only be achieved by a quarter of all cars being purely electric.

Where to take a huge investment

ACEA, like many national car associations, is therefore calling for a reduction in strict emissions conditions or at least vigorous sectoral financial assistance. Instead, Western Europe is pushing even harder for faster electrification.

However, Czech AutoSap points out that huge investments are the only recipe for maintaining your position in the markets. “The trend towards clean mobility, which is paradoxically accelerating the coronavirus pandemic in many markets, will require further huge investments. However, European carmakers have no choice if they want to keep up with aggressive Chinese or American competition, ”emphasizes Petzl.


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According to analysts, the necessary transformation, together with reduced demand, will thus require sacrifices. Smaller players in particular may have problems, for example Stefan Bratzel, director of the Center for Automotive Management (CAM).

Germany and China will win

Coronavirus has accelerated structural problems that were already permeating in a milder form before the crisis. European cars are no longer in demand as before, “said Bratzel. “Even before the crisis, the market did not grow, so many cars, such as Renault or Fiat, reduced production. They also had to solve the problems of the German carmaker. But unlike other European players, they will go through the crisis as winners, “he added.

However, the world winner will be China, says Felipe Munoz, a global analyst at JATO Dynamics, a company specializing in automotive information. The local market is already slowly recovering and is now clearly the strongest in terms of capital.

“It is not yet clear whether some European carmakers will end or whether they will just have to cut the product line. But it is likely that some will have to unite and some may end up in the hands of Chinese companies. They will definitely look for opportunities in Europe, “estimates Munoz.


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European carmakers will probably continue to clear positions. Managers contacted by the consulting firm KPMG even believe that in 2030, Western Europe will produce less than five percent of world production. Now she still triples.

Electric cars as the cause of redundancies

Whatever the end of the crisis, it is certain that the ongoing changes will mean a major loss of jobs. The main killer of work in the automotive industry is the transition to electric cars, which are not as demanding to manufacture as cars with internal combustion engines.

Germany alone can lose one hundred thousand jobs in the coming years, according to Landesbank Baden-Württemberg. Currently, about 830 thousand people work there in the automotive industry. In the Czech Republic, the situation could develop similarly, but according to AutoSAP, the future decline in employment is difficult to estimate. An estimated 180,000 people now work in the field.

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