Technology openness 'key to success' for auto industry amid crisis

The European automotive industry is navigating a "tense period," facing a potential crisis that could lead to significant job losses and a decline in value creation by 2040, according to Alexander Bamberger. He warns that excessive regulation and intense international competition, particularly from China, threaten Europe's standing in the sector.

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We are certainly in a tense period, in which we, as a European automobile manufacturer and as Europe as a whole, must ensure that we do not lose touch and thus value creation due to over-regulation and strong competition.

A study by the Fraunhofer Institute for Industrial Engineering (IAO) paints a stark picture, projecting that nearly half of the jobs in the European automotive industry could be at risk by 2040. The study estimates a potential loss of 95 billion euros in value creation, with the majority of this erosion expected within the next decade. The German automotive industry is particularly vulnerable, facing estimated losses of around 54.2 billion euros, with suppliers bearing a significant portion of this impact, making Austria as a supplier country especially affected.

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According to the study, up to 2040, almost 50 percent of jobs in the European automotive industry are at stake. Furthermore, 95 billion euros out of a total of 250 billion euros in value creation could be lost during this period. The vast majority of this will erode within the next decade.

Bamberger identifies overly strict climate protection regulations and the politically driven shift towards purely battery-electric vehicles as key challenges. While acknowledging the necessity of addressing climate change, he questions the pace and method of the transition. He points to the original EU fleet regulation, which mandated a 100% reduction in tailpipe emissions by 2035, effectively allowing only new battery-electric vehicles. Bamberger argues that measuring climate-relevant emissions solely by tailpipe output is insufficient, as it ignores the overall environmental impact, including the production, transport, and sourcing of fuel or electricity.

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The politically driven shift to purely battery-powered passenger cars and the effects of the associated requirements are hindering development and, above all, the innovative strength of the European industry.

He advocates for a holistic approach that considers CO₂ emissions across a vehicle's entire lifecycle. This comprehensive view, he suggests, would provide a more accurate assessment of environmental impact compared to current methodologies that overlook crucial upstream and downstream factors. The core message emphasizes "technology openness as the key to success," implying a need for diverse solutions rather than a singular focus on battery-electric technology.

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It is about how and at what pace this transition should ideally happen. I would like to give an example: According to the originally planned EU fleet regulation, emissions measured at the exhaust must be reduced by 100 percent (compared to 2021) in 2035. After that, only battery-electric vehicles could be newly registered.