Zwickau, it looks like now, is the future.
Cars have been produced in the Saxon city for almost 120 years.
Initially the Horch brand, Latin: Audi.
They were always powered by an internal combustion engine.
The last classic model rolled off the production line by June 26th last year.
Since then, the VW Group has only produced electric models here, in the future 330,000 units per year.
The 8000 jobs are considered safe.
Correspondent for economic policy and deputy head of economics and “Money & More” for the Frankfurter Allgemeine Sonntagszeitung in Berlin.
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Editor in the economy of the Frankfurter Allgemeine Sonntagszeitung, responsible for “Der Volkswirt”.
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Responsible editor for economics and "Money & More" of the Frankfurter Allgemeine Sonntagszeitung.
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If the EU Commission in Brussels has its way, this change is imminent for the entire industry: From 2035 onwards, all new vehicles in the European Union are to be operated emission-free.
The Federal Republic is affected more than any other member state, with its more than 800,000 mostly well-paid employees at car companies and suppliers - not counting all the jobs that depend on it in other industries.
The decisive factor for the future of the German auto industry will be: will it retain its global supremacy in the age of e-mobility? Will VW succeed in dominating the mass market? And do the luxury manufacturers BMW and Mercedes manage to enforce their premium surcharges also for battery vehicles? The signs are not that bad. They have all invested billions, woken up by Tesla pioneer Elon Musk, come with dozens of new e-models, some with a significantly wider range - so far one of the main obstacles to switching to e-mobility. That is gradually changing, fueled by government incentives.
The fruits will gradually show up.
VW boss Herbert Diess, who staged with verve as the pioneer of e-mobility, inspires investors with his e-offensive.
The price of the VW share has risen by 40 percent since the beginning of the year alone.
The stock exchange, which is known to trade the future, trusts Volkswagen, with its size, cost advantages and sales power, to have what it takes to dictate events even in the e-age.
"Significant consequences for jobs"
Not everyone in the industry is that euphoric.
BMW boss Oliver Zipse defends the goal of “technology openness”, that is to say: the battery is not the only path to bliss.
In addition, the car manufacturers will still produce internal combustion engines for markets outside Europe.
For many regions, e-cars would simply be too expensive. And the industry association VDA warns of the consequences, especially for suppliers. The fact that the factual ban on internal combustion engines also applies to hybrids and light commercial vehicles is "hostile to innovation and the opposite of being open to technology". The required acceleration of the transformation is hardly achievable, especially for many suppliers, warns association boss Hildegard Müller - and warns of "considerable consequences for jobs".
For example in Kirchheimbolanden. The city in the province of Rhineland-Palatinate has almost 8,000 inhabitants. The largest employer is BorgWarner, a supplier to the automotive industry. The company produces turbochargers in its plant, around three million units every year, a world market leader. But if the combustion engine dies now, so does the turbocharger. Then nobody needs the world market leader anymore. So what will happen to the 1,500 employees in this small town?
The truth is that the structural change in the auto industry did not just begin on Wednesday, when the EU Commission announced the end of the combustion engine in 2035.
IG Metall knows the worrying figures: the automotive companies had 834,000 employees in 2018, new jobs had been created over the years, but things have been going downhill since then: 11,000 jobs were lost in 2019, and a further 21,000 were cut in 2020.
The structural change is there and can be felt.
The only question is what will come after that.
221,000 jobs are at risk
According to an Ifo study commissioned by the VDA, up to 221,000 jobs in the automotive industry are on the brink of switching to e-mobility. Around 613,000 jobs in Germany still depend on the construction of gasoline and diesel cars. With the ramp-up of electromobility in 2025, “between 29 percent and 36 percent of the affected employees would be available”.