when the switch to electric involves massive layoffs

Over the past few weeks, announcements of job cuts have continued to rain in. Nissan, Audi, Ram, Volkswagen, Jeep, Michelin, Forvia, Lotus… So many companies in the automobile industry affected by the sector crisis. How to explain this situation and what should you expect?

The automotive industry is going through difficult times. Several factors can explain the current situation. First of all, there is a drop in demand at the global level. Sales are failing to return to pre-Covid-19 pandemic levels. Inflation obviously has something to do with it. Added to this is the transition to electric. A major change on several levels.

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A crisis linked to the transition to electricity?

As a result, many companies in the industry have announced upcoming job cuts. In Germany alone, almost 200,000 jobs could disappear by 2035. According to the VDA (the association of the German automobile industry), “ the production of electric vehicles requires fewer jobs overall than in the past “. Some professions are more affected than others.

Unfortunately, the slowdown in sales of electric cars that we have been observing for several months cannot compensate for the massive investments by manufacturers. When such a situation occurs, the reaction is often the same: the mammoth must be degreased. Nissan will, for example, take “ urgent measures » to stem losses by reducing its production capacity by 20%.

9,000 fewer jobs at Nissan

This decision could cause the loss of 9,000 jobs. A recent announcement which risks being a source of uncertainty for the company’s 130,000 employees. The Japanese manufacturer lost 55 million euros during the last quarter. Nissan explains that it is in a delicate situation. The firm says “ face increasing costs ”, as well as too many unsold items.

The company operates the UK’s largest car factory in Sunderland. The site has an annual capacity of up to 600,000 cars, but it has only produced 325,000 in 2023. Makoto Uchida, general manager of Nissan, even symbolically declared that he would give up half of his salary from November, time to make all the necessary adjustments.

Audi, Lotus, Jeep, Ram, all in the same boat

The Yokohama firm is not the only one to be in a bad situation. Audi recently announced the end of production from February 2025 at its factory in Brussels. In total, the German brand is considering cutting 4,500 positions, including 3,000 in Belgium. Without giving many details, a spokesperson said that “ the economic context has deteriorated. Germany is falling behind in terms of competitiveness ».

For its part, the British Lotus has confirmed the upcoming layoffs of 200 people based in the United Kingdom. “ We believe this is essential for the organization to be leaner and more competitive in today’s market “, we can read in the company’s press release. A restructuring project is underway to cope with the drop in demand.

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Jeep, now owned by Stellantis, is also talking about 1,100 fewer jobs from the start of 2025. Stellantis’ turnover has collapsed in the American market (-42%). Carlos Tavares’ group announced a few months ago that it wanted to downsize at its Warren site, in the United States. In Michigan, Ram employees are also worried: 2,450 jobs are threatened.

Equipment manufacturers are also in difficulty

But car manufacturers are not the only ones affected by the crisis. Equipment manufacturers are also on the front line. The German Schaeffler announced the loss of 4,700 jobs in Europe, as well as the closure of two sites. In Haguenau, in Alsace, the teams are worried. ZF, another German company, announced this summer the elimination of 11,000 to 14,000 jobs in Germany by 2028.

At Michelin, the Clermont-based tire giant, the situation is not much better. Two factories (Cholet and Vannes) will close and 1,250 jobs risk disappearing. Same thing at Valeo: the French supplier plans to sell three factories in France and cut 1,150 jobs worldwide, including 800 in Europe. Finally, Forvia is also preparing a layoff plan from December 2024.