brands like Tesla and BYD are increasingly contesting the market shares of European automobile manufacturers. This could have drastic consequences for local corporations, as a study by the Boston Consulting Group warns. If the world market share falls from 26 to 24 percent by 2040, 300,000 jobs would be lost among Europe’s car manufacturers and economic output would shrink by 37 billion euros, the industry experts wrote.
With cheaply produced, digitized and fully networked electric cars, the new competitors could reduce the brand value of European car manufacturers. They struggled with a shortage of skilled workers and rising energy prices. The severity of the consequences will depend on whether the local auto industry can retain its technological leadership and continue to produce cost-efficiently. The geopolitical environment is also causing concern for the local automotive industry, especially with regard to the world’s largest sales market in China.
stands as an example for this Volkswagen. For many years, the carmaker dominated with its core brand VW as the market leader in China, but recently fell behind. Electric cars from VW in particular are in little demand among Chinese customers. Most recently, BYD took advantage of this. The Chinese group topped the domestic car sales charts in the first quarter of 2023. BYD and numerous other brands from China are now also pushing into Europe. After Tesla, the companies established there are facing potentially strong competition. In Germany BYD is aiming for a market share of up to 10 percent in the medium term.
Large parts of the European auto industry are reacting to this with austerity measures. Carlos Tavares (64) has already trimmed Stellantis for efficiency in recent years with previously stumbling brands such as Peugeot, Citroen, Opel and Fiat. Volkswagen boss Oliver Blume (55) is aiming for 2027 Group return of 10 percent at. Most recently, driven by stable, high prices, it was 8.1 percent. If Volkswagen wants to continue to improve, the group will hardly be able to avoid some cuts. Just that Core brand VW is about to be renovated
. And savings are also being made at Mercedes-Benz. CEO Ola Källenius (54) propagates to the outside world especially its luxury course
. Internally, however, some areas fall victim to this. Last but not least, Mercedes is eliminating its entry-level A and B-Class models in the future.
In addition to the baseline scenario, the Boston Consulting Group also outlined a best-case and worst-case scenario. “New technologies and green energy are a huge opportunity for the European auto industry,” said industry expert Albert Waas: “By 2040, 800,000 new jobs and additional tax revenue of 25 billion euros are possible.” But “overall, the downside risks outweigh the upside potential,” the study said. In the worst case, the market share of European car manufacturers could halve by 2040 and annual economic output could fall by a third or 145 billion euros. This would come with the loss of 1.5 million jobs.