France’s impending 2035 deadline to phase out new combustion engine vehicles presents a significant challenge for the automotive sector and auto workers. While optimism surges in regions like the north, where a ‘Battery Valley’ is emerging, parts suppliers in other areas feel apprehensive.
The European mandate permits the sale of new petrol and diesel cars only for the next decade, necessitating a swift transformation for the industry, which employs 200,000 people in France.
Severine Person, a quality control expert at Walor’s facility in Vouziers, northeastern Ardennes, expressed concerns about the shift to electric vehicles (EVs). “The transition (to electric vehicles), it could have been done when Walor bought us but they didn’t invest,” she said. The facility, producing connecting rods for tractors and trucks, now faces uncertainty due to declining demand for transmission differential housings and engine manifolds.
Walor, recently acquired by a German turnaround specialist fund, plans to sell the Vouziers site and another nearby. Bruno Bodson, a CFDT trade union shop steward, remarked, “Before, Citroen would distribute work to everyone in the Ardennes. They didn’t go to the other side of the world to get parts.”
Conversely, northern France presents a contrasting scenario, with several battery ‘gigafactories’ under construction, including the Automotive Cells Company (ACC) in Douvrin. This joint venture, comprising Stellantis, Mercedes, and TotalEnergies, erected a massive battery plant on a former Stellantis engine factory site, home to Citroen and Peugeot.
Stellantis seeks to address the ‘social need’ for retraining factory employees, offering 12 weeks of training on managing automated production lines at ACC’s battery training center. Despite these efforts, the auto parts sector anticipates significant job losses. A 2021 study by the French metalworking industry projected 65,000 jobs at risk by 2030 due to the EV transition.
Economist Bernard Jullien, an expert on the French car industry, estimates 40,000 job losses in the auto parts sector over the next 10 to 15 years. This impact might be lessened by the imminent retirements of many workers.
Ludovic Bouvier, a regional CGT metalworkers union leader, raised concerns about offshoring, comparing it to the steel industry’s decline. “The announcement by Europe of the end of internal combustion engines became the opportunity for manufacturers to offshore their production,” he noted.
Stellantis and Renault have already moved some production abroad, with Stellantis manufacturing its new Citroen electric hatchback in Slovakia and Renault producing its R5 hatchback domestically.
A recent study by two climate groups indicated that the lower labor requirements for manufacturing EVs might favor small car production in Europe. Jullien, however, predicts more offshoring, potentially reducing French auto industry employment to 100,000 or even less.
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