Emrullah Karaca, a mechanic employed by the automotive supplier Continental in Gifhorn, northern Germany, April 23, 2024 (AFP / Léa PERNELLE)
In a few months, Emrullah Karaca will be ready to assemble heat pumps. A new profession for this German mechanic who has been manufacturing car brakes for more than twenty years but whose factory is doomed to close.
At the end of 2027, the automotive supplier Continental will relocate production from its Gifhorn site, in northern Germany, to Croatia, the Czech Republic and Wales to remain “competitive”.
For the 800 employees who will lose their jobs, like Emrullah Karaca, the race for retraining has begun.
He is one of thousands of workers in automotive subcontracting, a flagship sector of German industry, hit by a tsunami of social plans in recent months. In Germany, the specter of industrial dropout hangs over the European election campaign.
European equipment manufacturers are experiencing the double shock of the planned end of the thermal engine in the EU and the rise of Chinese competition.
Like Continental, which will cut some 7,000 jobs worldwide, the Germans Bosch, ZF, Webasto recently announced significant cuts in their workforce. The same in France for the Forvia and Valeo groups.
Emrullah Karaca, who has been manufacturing car brakes for more than 20 years, in the factory of equipment manufacturer Continental in Gifhorn, northern Germany, April 23, 2024 (AFP / Léa PERNELLE)
In Gifhorn, a regional company, Stiebel Eltron, offered to transform the factory into a heat pump production site and at 49 years old, Emrullah Karaca is training for this new profession.
“Brakes or heat pumps, for me it comes down to the same thing!”, assures AFP this father of three children. Not without a pang in the heart: both of his parents were already workers at Continental.
Stiebel Eltron hopes to preserve 300 jobs. Up to 100 Conti employees could find work in the Siemens Mobility railway factory, around thirty kilometers away.
– New actors –
Essential for the manufacture of exhaust pipes, pistons, cylinders, gearboxes, brakes, automotive subcontracting workers – some 270,000 jobs in Germany – wonder what the future will hold.
“For every 100 workers involved in the manufacture of a traditional engine, only 10 are needed to manufacture an electric car engine,” summarizes Jutta Rump, professor at the University of Ludwigshafen.
While the European Union plans to ban sales of new thermal cars in 2035, the accelerated electrification of the automotive sector is disrupting the core business of traditional equipment manufacturers.
They face competition from new players, notably Chinese manufacturers of electronic components who are grabbing market share.
Mechanic Emrullah Karaca on the site of his Continental factory in Gifhorn, northern Germany, April 23, 2024 (AFP / Léa PERNELLE)
The Chinese battery giant CATL has thus risen in a few years to third place among global equipment manufacturers, still led by the German Bosch, according to the Roland Berger consulting firm.
Traditional equipment manufacturers also justify workforce cuts by pressure from car manufacturers engaged in a price war.
– Strike –
In Germany, one in three subcontractors plans to relocate abroad for reasons of competitiveness, according to a study by the federation of German automobile manufacturers (VDA).
In the southwest of the country, the Ford plant in Saarlouis will close in 2025. Gone are the traditional Fiesta, Mondeo, Focus, which the site has long manufactured. The American manufacturer has chosen its factory in Valencia, Spain, for the production of large-scale electric models.
This closure is an earthquake for the fleet of equipment manufacturers working with the factory. Their employees went on a six-day strike in March to obtain sufficient severance pay.
Among them, Luca Thonet, logistics team leader at Lear, one of Ford’s suppliers. At 33, he would like to stay in this region bordering France.
“But there is almost no industry left in the region; the other factories are not in a very good situation either,” he explains to AFP.
He cites the example of the equipment manufacturer ZF which has also announced two factory closures in Germany and whose works council fears the loss of 12,000 jobs, particularly in Saarbrücken, 25 kilometers from Saarlouis.
Because if Germany is faced with a serious labor shortage, it does not apply to all sectors. In IT, sales, product development “we lack qualified personnel, but this is not the case in production”, warns Jutta Rump.
