Automakers will likely reduce production capacity on both continents in 2025 as they face emissions targets and tariffs, while China’s dominance in electric vehicles (EVs) will increase due to its ahead in software and electrification, the firm said.
Closures or sales are more likely in high-cost countries, where political and societal pressure will be offset by increased competition, Gartner vice president analyst Pedro Pacheco told Reuters.
“It’s a bit like a pressure cooker,” Pacheco said. “The pressure is increasing and increasing and… this will push a number of car manufacturers to make more pragmatic decisions.
Chinese brands could buy factories to overcome trade barriers, or open new factories in lower-cost European countries and free trade partners like Morocco or Turkey, the firm predicted.
Fearing disruptions linked to European Union rules on CO2 emissions in 2025, the CEO of German automotive supplier Bosch, Stefan Hartung, told the publication Auto Motor und Sport on Wednesday that the bloc should refrain from ‘imposing fines on companies that do not achieve set targets.
-The European auto industry is no longer able to meet its 2030 and 2035 targets for electric vehicles, said Luc Chatel, president of French auto lobby PFA.
“The risk is that we end up reducing sales of combustion engine vehicles to artificially increase sales of EVs,” he told Reuters.
Despite the challenges of electrification, Gartner predicts that deliveries of electric buses, cars, vans and heavy-duty trucks will increase by 17% overall in 2025. It predicts that more than 50% of all vehicle models sold by car manufacturers will be EVs by 2030.
To achieve this change, traditional automakers could purchase software architecture from new EV makers and digital companies, strengthen research and development centers in technology hubs, or partner with technology companies to create joint ventures of self-financed EVs, said P. Pacheco (Reuters).
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