Europe’s autoworkers will pay the price for electric vehicle push

Though built in England, the petrol engine of a Mini is a map of Europe: engineered in Germany, containing an alternator from France, an ignition coil from Italy and a coolant pump from Austria. 

Each step in this process involves a person, if not several.

Yet not one of them will be required in as little as seven years when the brand goes fully electric. 

The same is true of those who supply engines for Volvo Cars, Mercedes-Benz, Jaguar, Ford or any of the brands that have set end dates for engine-car sales in Europe. 

That electric vehicles take fewer people to make and design is well documented. 

What had remained abstract is the effect on the region’s workforce when the axe begins to swing.

Ford this month announced plans to cut 40 per cent of its entire European engineering team. 

The shift to electric is driving the brand (and many others) out of smaller models, while their remaining models are battery-powered and so are swifter to engineer and simpler to assemble.

The cold reality is that Ford’s announcement is only the first cut, comprising one small part of an entire machine that will be wound down within a decade or so.

Today, Europe’s auto industry employs 3.5mn people directly in manufacturing.

Ford chief executive Jim Farley estimates that EVs require 40 per cent fewer people to make — the equivalent of 1.4mn jobs if applied across the industry. 

These are high-skilled, high-productivity, well-paid positions that are often in geographic areas that would otherwise be economic backwaters. Just look at Nissan’s Sunderland plant or in Slovakia, which has four plants that turn out one car for every five people living in the country annually. 

Yes, there may be job creation, new roles in the new frontiers of batteries or software development — a 2021 study from Boston Consulting Group estimated the creation of 581,000 roles in Europe. But to pretend they will be filled by retraining discarded diesel engineers is fanciful. 

Some companies offer retraining, others will not replace retiring staff. But this will only dull, not eliminate, the pain. 

The most painful thing, perhaps, for the workers losing their jobs is that the march to the EV scaffold was begun by politicians and regulators.

Europe’s regulators have decided that the region’s new cars need to be zero emission by 2035. 

This is unquestionably the right choice for the planet. But that necessity will create huge collateral damage.

Europe today is a world leader in engines, being home to Ferrari, Mercedes-Benz and Volkswagen (Japan and Detroit deserve podium spaces here too.)

Yet it is China, which anticipated the battery revolution more than a decade ago and has positioned itself as the global leader, that is best placed to dominate tomorrow’s auto landscape. 

Hydrogen, with its low energy density, is an imperfect solution for cars unless used as a wider store of renewable energy, but it does at least use many of the same supply chain roles that exist today.

A strategic, co-ordinated decision 15 years ago by European authorities to pursue this technology would have, if successful, protected the jobs that today find themselves facing extinction.

Even Mate Rimac, the Croatian electric hypercar inventor whose business has been partly acquired by Porsche, says the region is “shooting itself in the foot” with its policies. 

The coming job cuts are the unavoidable casualty of deliberate policy choices made by regulators who will not be in office when the region’s dole queues are swelled by their decisions. 

Even if you agree that the policy was necessary, it is still true that Europe set a bomb under the region’s auto employment. It cannot now complain when the whole thing goes up.