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European car parts suppliers have announced more than 100,000 job losses in the past two years as they suffer from low demand for vehicles and fierce competition from Chinese rivals. Figures compiled by European trade body Clepa and shared with the FT show that parts suppliers announced 50,000 job losses in 2025, following 54,000 in 2024, in a sign of continued distress for the struggling sector.
“It is a quite unprecedented situation with over 100,000 jobs announced to be cut in the past two years . . . we haven’t stopped the bleeding,” said Benjamin Krieger, secretary-general of Clepa. During the pandemic years of 2020 and 2021, suppliers announced a total of 53,700 job cuts, but demand in Europe has remained significantly below pre-pandemic levels, with limited uptake for new electric vehicles.
The sector’s poor performance has led many car companies to cut output across the continent, hitting parts makers. The industry also faces stiff competition from Chinese companies that are increasing their share of car sales in the European market. “The dragon in the room is China. They have technically well-made vehicles coming to the market at an extremely low price,” Krieger added.
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Bosch, the world’s largest auto supplier, announced in September it would cut 13,000 jobs by 2030 after saying it faced an annual cost gap of €2.5bn, leading to protests from employees last month. After parts makers Valeo, Forvia and Schaeffler announced plans in 2024 to cut thousands of jobs, last year saw the announcement of further job cuts at Continental’s automotive parts division, since spun off under the brand Aumovio.
Arnd Franz, chief executive of Stuttgart-based Mahle, told the FT it was “hard to say” whether the sector had hit the bottom or whether it would continue to face challenges in 2026. The supplier announced measures to cut 1,000 jobs in November, mostly in Europe and North America. “We had much more positive expectations for 2025,” said Franz, but said that sweeping US tariffs by President Donald Trump had led to slower than expected demand for car parts. The pressure on the industry would mean “we will see a wave of consolidation in the next two, maybe even three years, and capacity adjustments”, he added.
Valeo chief executive Christophe Périllat was more blunt, warning last November that the industry faced a “Darwinian transformation”, adding that more European jobs would be lost unless Brussels protected the sector from Chinese competition. While uptake of EVs has been slower than anticipated in Europe, the move away from petrol and diesel cars has steadily increased pressure on European suppliers which has focused on the production of combustion engines. The European Commission is considering proposals to protect the sector by introducing “made in Europe” protections for key industries, which would ensure that a certain threshold of parts are made on the continent.
Parts makers such as Valeo have called for the threshold to be about 75 per cent, in order to maintain the status quo, but the proposals have been opposed by carmakers who fear a blow to their competitiveness if they are forced to use more expensive European components. The measures are expected to be unveiled at the end of January. Krieger insisted that European companies would be able to compete with their Chinese counterparts if they were all producing within the EU.
“We are sure the Chinese and Europeans would be competitive under the same framework conditions, if the same rule book applies to everyone,” he added.
Source – https://www.ft.com/content/6d96578e-4d24-4ea5-9f81-55a42de036c8