The Importance of the Automotive Industry in Europe
The automotive industry has long been a significant contributor to Europe’s economy, with sales reaching a staggering 28.5 billion euros. Despite its vital role, the industry is currently facing challenges that could potentially lead to deindustrialization in Europe, a scenario that has raised significant concerns among industry insiders.
Challenges faced by Austria’s Automotive Supply Industry
Like many other sectors, Austria’s automotive supply industry is grappling with issues related to competition and costs. The head of the Industrial Science Institute, Herwig Schneider, has stressed the importance of continued commitment to maintaining Austria’s position as an automotive hub. The need to fight for the location represents a significant challenge to the industry, as it faces increasing pressure from various fronts.
The Importance of Funding and Lowering Costs
The automotive industry’s contribution to the economy is significant, with 81,000 direct or around 200,000 indirect jobs and sales of 28.5 billion euros. As such, the introduction of more targeted funding, such as for battery technologies, and the reduction of wages and energy costs are critical strategies in mitigating the risk of industry migration, according to Dietmar Schäfer, chairman of the ARGE Automotive Supplier Industry.
Transitioning to Green Energy
The industry is currently experiencing a profound transformation, as evidenced by the rise of electric cars. However, the planned phasing out of combustion engines by 2035 raises questions, particularly in the absence of sufficient green electricity production across Europe. Schäfer argues that electric cars powered by fossil fuels do not create any added value and do not contribute to climate change mitigation.
Job Security in the Automotive Industry
With the shift towards electric vehicles, the industry is also facing challenges in job security. A combustion engine comprises approximately 2,000 moving parts, while an electric motor consists of around 20 parts. The added value in producing an electric car is significantly lower, putting an estimated 40 percent of automotive jobs at risk.
Europe’s Position in Battery Development
Europe has also fallen behind in the race for battery development, with most advancements being made in China and the USA. Schäfer warns that the push towards decarbonization should not lead to demobilization and deindustrialization. He advocates for promoting technological openness towards other forms of energy such as hydrogen, bio-fuel, and e-fuels.
