{"id":17256794,"date":"2025-05-22T13:03:00","date_gmt":"2025-05-22T11:03:00","guid":{"rendered":"https:\/\/felss.com\/?post_type=blog&#038;p=17256794"},"modified":"2026-05-22T13:19:56","modified_gmt":"2026-05-22T11:19:56","slug":"challenges-of-the-automotive-supply-industry-and-the-impact-on-the-labour-market","status":"publish","type":"blog","link":"https:\/\/felss.com\/en\/blog\/challenges-of-the-automotive-supply-industry-and-the-impact-on-the-labour-market\/","title":{"rendered":"Challenges of the automotive supply industry and the impact on the labour market"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The automotive supply industry is facing a number of challenges in 2024 and 2025, which are characterized by various global influences and regional peculiarities. Below you will find a summary of the most important points, which are based on information from the VDA and VDMA.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"viewer-j3c1z20210\">Automotive Industry is facing a couple of Global Challenges<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Transformation to electric mobility:<\/strong>\u00a0The conversion from combustion engines to electric drives requires significant investments and technological adjustments.<\/li>\n\n\n\n<li><strong>Digitalisation:<\/strong>\u00a0The integration of software and networked services is becoming increasingly important for competitiveness.<\/li>\n\n\n\n<li><strong>Supply chains:<\/strong>\u00a0Dependence on global supply chains, especially from China, is a risk exacerbated by geopolitical tensions and trade conflicts.<\/li>\n\n\n\n<li><strong>Semiconductor shortage:<\/strong>\u00a0The automotive industry is heavily dependent on the availability of semiconductors, the shortage of which has already led to production losses.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"viewer-8fx4t31059\">Regional focus<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Europe:<\/strong>\u00a0Here, energy costs are 2-3 times higher than competitors in China and the US, which affects competitiveness.<\/li>\n\n\n\n<li><strong>Asia:<\/strong>\u00a0China in particular is both an important supplier and a large market, the dynamics of which are influencing the global automotive industry.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"viewer-t5fvi31160\">Challenges according to the VDA and VDMA<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Financing:<\/strong>\u00a0New financing hurdles due to stricter lending criteria and higher interest rates are making the necessary transformation more difficult.<\/li>\n\n\n\n<li><strong>Innovation:<\/strong>\u00a0The promotion of research and development is crucial in order to survive in international competition.<\/li>\n\n\n\n<li><strong>Macroeconomic factors:<\/strong>\u00a0Inflation and geopolitical uncertainties pose additional risks.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Which companies are most affected?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\" id=\"viewer-0a9kx31548\">The automotive supply industry is undergoing a comprehensive transformation, which particularly affects companies that are active in the following sectors:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Manufacturers of internal combustion engine (ICE) components:<\/strong>&nbsp;These companies face the challenge of adapting to the electrification of the powertrain. According to projections, up to 40 percent of ICE suppliers will have to start a transformation quickly to secure their existence.<\/li>\n\n\n\n<li><strong>Companies with high material costs:<\/strong>&nbsp;Those who invest a large part of their costs in materials for ICE models need to rethink their business models.<\/li>\n\n\n\n<li><strong>Suppliers affected by supply chain disruptions:<\/strong>&nbsp;In particular, disruptions and geopolitical tensions caused by COVID-19 have impacted supply chains.<\/li>\n\n\n\n<li><strong>Companies with imminent credit refinancing:<\/strong>&nbsp;Many suppliers will soon have to refinance loans in an environment where investors are eager to decarbonize.<\/li>\n\n\n\n<li><strong>Companies that need to invest in operational improvements and new business models:<\/strong>&nbsp;These companies are under pressure to optimize their cash conversion while investing in innovation.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Impact on jobs<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\" id=\"viewer-w0i7l33146\">The impact on jobs in the automotive supply industry is significant and complex. Here are some key points based on recent studies and forecasts:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Job losses:<\/strong>\u00a0A study by the ifo Institute predicts that at least <strong>178,000<\/strong>\u00a0jobs in Germany could be affected by 2025, especially in the medium-sized supplier industry.<\/li>\n\n\n\n<li><strong>Transformation:<\/strong>\u00a0The shift towards electromobility and digitalization is leading to a change in the required qualifications and thus to a change in the workplace landscape.<\/li>\n\n\n\n<li><strong>New occupational fields:<\/strong>\u00a0It is expected that <strong>\u00a0completely new occupational fields will be created <\/strong>\u00a0for 70,000 jobs and a further <strong>200,000<\/strong>\u00a0jobs will change significantly, which will entail a considerable need for further training.<\/li>\n\n\n\n<li><strong>Regional differences:<\/strong>\u00a0In eastern Germany, ten percent more jobs could be created, while in southern Germany the job development remains constant.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Businesses and politicians must take action<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\" id=\"viewer-ndqbe33612\">These developments require companies and policymakers to actively shape the transformation to mitigate the impact on employees and support the transition to new technologies and ways of working.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\" id=\"viewer-wd4l420510\">The apparent contradiction between job losses and the simultaneous shortage of skilled workers in the automotive supply industry can be explained by several factors:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Structural change:<\/strong>\u00a0The industry is undergoing a profound change, away from traditional combustion engines and towards electromobility and digitalization. As a result, certain qualifications are no longer in demand, while at the same time there is a high demand for new, specialised specialists.<\/li>\n\n\n\n<li><strong>Skills gap:<\/strong>\u00a0There is a disconnect between the skills offered by workers and the skills needed by companies. Many existing jobs require retraining or upskilling to keep up with technological changes.<\/li>\n\n\n\n<li><strong>Demographics:<\/strong>\u00a0Many developed countries have an aging population, which leads to a natural decline in the labor force. At the same time, many experienced professionals are retiring, which exacerbates the shortage of qualified personnel.<\/li>\n\n\n\n<li><strong>Regional differences:<\/strong>\u00a0While some regions are reducing overcapacity and losing jobs, others have a growing need for skilled workers, especially in technology and innovation hubs.<\/li>\n\n\n\n<li><strong>Global competition:<\/strong>\u00a0International competition for talent is further exacerbating the shortage of skilled workers. Highly qualified specialists are in demand worldwide and can often choose between various international offers.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\" id=\"viewer-89f7734261\">These factors combine to create a complex labour market situation in which, despite job losses in certain areas, there is a shortage of skilled workers in other, future-oriented areas. To meet these challenges, targeted education and retraining programmes are necessary, as well as a flexible adaptation of the workforce to the new requirements of the industry.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What measures could help tackle the skills shortage?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\" id=\"viewer-og50920546\">Companies can manage the skills shortage through a combination of internal initiatives and external strategies. Here are some measures that have proven to be effective:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Training and courses:<\/strong>\u00a0Companies can set up their own academies and offer specialised courses to upskill employees and attract new talent.<\/li>\n\n\n\n<li><strong>Targeted training:<\/strong>\u00a0Modern training and targeted training are crucial to equip the workforce for the challenges of the future.<\/li>\n\n\n\n<li><strong>Raising labour potential:<\/strong>\u00a0The shortage of skilled workers can be counteracted by increasing labour force participation and exploiting all labour potential.<\/li>\n\n\n\n<li><strong>Improving the quality of work:<\/strong>\u00a0A modern work environment and a positive work culture can help attract and retain skilled workers.<\/li>\n\n\n\n<li><strong>Modernising immigration:<\/strong>\u00a0Attracting and integrating skilled workers from abroad can help meet the needs.<\/li>\n\n\n\n<li><strong>Social recruiting:<\/strong>\u00a0Using social networks for recruitment can help companies reach a larger audience and target potential candidates directly.<\/li>\n\n\n\n<li><strong>Flexible working time models:<\/strong>\u00a0New working time models such as the four-day week can be attractive for skilled workers and contribute to employee retention.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\" id=\"viewer-0p7oj20589\">These strategies require a proactive approach and a willingness to invest in employees and company culture. In addition, it is important to create a policy framework that promotes further training and facilitates the immigration of skilled workers.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Sources<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.vda.de\/de\/presse\/Pressemeldungen\/2024\/240311_PM_Studie_Finanzierung_Zulieferer_Oliver_Wyman_2024\" target=\"_blank\" rel=\"noreferrer noopener\">Gemeinsame Studie des VDA und der Strategieberatung Oliver Wyman.<\/a><\/li>\n\n\n\n<li>So wirbt der automobile Mittelstand um Fachkr\u00e4fte.\u00a0<a href=\"https:\/\/www.vda.de\/de\/themen\/automobilindustrie\/marktentwicklungen\/fachkraeftemangel\" target=\"_blank\" rel=\"noreferrer noopener\">VDA<\/a><\/li>\n\n\n\n<li>Automobilzulieferer: Transformation gemeinsam meistern.\u00a0<a href=\"https:\/\/www.deloitte.com\/de\/de\/Industries\/automotive\/perspectives\/automobilzulieferer-transformation.html\" target=\"_blank\" rel=\"noreferrer noopener\">Deloitte Deutschland<\/a><\/li>\n\n\n\n<li>Arbeitsplatzverlust durch Transformation in der Autoindustrie.\u00a0<a href=\"https:\/\/www.vda.de\/de\/presse\/Pressemeldungen\/2021\/210506-Arbeitsplatzverlust-durch-Transformation-in-Autoindustrie\" target=\"_blank\" rel=\"noreferrer noopener\">VDA<\/a><\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Author:<\/strong>\u00a0Wolfgang A. Haggenm\u00fcller<br><strong>Click here for the original article:<\/strong>\u00a0<a href=\"https:\/\/haggenmuellerfreel.wixsite.com\/mobilityandmore-eng\/post\/challenges-of-the-automotive-supply-industry-and-the-impact-on-the-labour-market\" target=\"_blank\" rel=\"noreferrer noopener\">Mobility &amp; More<\/a>, the blog focusing on mobility, technology and sustainability.<\/p>\n","protected":false},"author":11,"featured_media":17256789,"template":"","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[],"ppma_author":[293],"class_list":["post-17256794","blog","type-blog","status-publish","has-post-thumbnail","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/blog\/17256794","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/blog"}],"about":[{"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/types\/blog"}],"author":[{"embeddable":true,"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/users\/11"}],"version-history":[{"count":1,"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/blog\/17256794\/revisions"}],"predecessor-version":[{"id":17256796,"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/blog\/17256794\/revisions\/17256796"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/media\/17256789"}],"wp:attachment":[{"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/media?parent=17256794"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/categories?post=17256794"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/felss.com\/en\/wp-json\/wp\/v2\/ppma_author?post=17256794"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}