German autos supplier Bosch CEO Stefan Hartung expects very little growth in car and commercial vehicle markets worldwide this year and next, he said in an interview with Reuters.
“Demand on the car market (globally) is lower than the industry expected five years ago,” Hartung said on the sidelines of the IAA Transportation trade fair in Hanover, Germany.
Europe was expected to produce a few million fewer cars than projected five years ago, he said without giving specific details, adding that it would take a few years for demand to recover.
The region’s carmakers are struggling with high labour and energy costs as well as rising competition from lower-cost Asian rivals shipping more cars to Europe.
Europe’s largest carmaker by sales Volkswagen said early this month it was considering shutting some plantsin Germany for the first time in its history as part of a cost-cutting drive to compete against Asian rivals.
Hartung also sees a slowdown in growth in the electric vehicle market, although he said battery electric car sales were growing compared to last year, albeit at a slower pace, as consumers shift to plug-in hybrids, including in China.
Bosch will continue pursuing its electrification strategy, as corrections on the market were normal, Hartung said.
He again would not rule out further job cuts at Bosch sites, including large ones, due to clients postponing their EV parts orders.
Europe’s largest automotive supplier said in February it would cut around 3,500 jobs in the home appliance division by 2027, and later in April warned of further cost cuts and staff reductions.
Global automakers are scaling down their electrification targets, hurt by slowing demand for full EVs due to a lack of affordable models, slow roll-out of charging points, growing trade tensions and increased competition from Chinese rivals.
