- Moving to electric vehicles will create a shift in the automotive workforce
- Thousands upon thousands of job losses expected
- As OEMs invest to retool factories and increase profitability, cuts are inevitable
As they say, there are always two sides to a story, or a ying for a yang, and all that jazz. While the electrification of the automobile is but one small step in humanities efforts to curb global warming, it will come at a cost. Producing electrified vehicles, which rely on fewer parts, will require a smaller workforce which will result in many job losses in the coming years.
There’s an undeniable chain reaction currently taking hold of the automotive industry – we are essentially witnessing automotive history. The move towards electric vehicles is inevitable and as such, all major car manufacturers are investing monstrous sums of energy and resources into developing the required technology. Some carmakers do not have sufficiently deep pockets to support such a costly undertaking which, in part, explains the numerous mergers and partnerships that have evolved over the last year or two.
Despite joint efforts and development cost sharing, the necessary funds to stay competitive in this evolving industry are heavy burdens to bare. This even applies to the Volkswagen Auto Group, where Audi has announced that they will spend €300 million refurbishing their Ingolstadt and Neckarlsum factories to produce EVs as well as cutting up to 9,500 jobs by 2025. The cuts will occur via natural attrition and incentivized early retirement plans but these remain job losses.
Meanwhile, BMW has recently informed its workforce that profit-related and other bonuses paid at Christmas, for example, will be eliminated as BMW wants to cut €12bn in costs by 2022. While no jobs are in jeopardy at the moment, saving €12bn will not solely be achieved by dropping bonuses.
As well, independent suppliers are bracing for fundamental changes as parts requirements will shrink considerable over the next decade. This will represent thousands upon thousands of jobs losses worldwide.
Although the outlook is bleak for the car industry, at least through the next ten years, the offset is that energy-related jobs are on the rise.