The EU automotive industry at a crossroads

The European Union’s automotive sector employs more than 6 million workers and continues to provide relatively well-paid and secure jobs. However, electrification, digitalisation, competition from China and demographic change are reshaping employment across the sector. While total automotive employment remained broadly stable between 2008 and 2025, this masks a decline in vehicle manufacturing and supplier employment after 2019 and a shift away from traditional Western European automotive economies, towards Central and Eastern Europe. Supply chains have also evolved. Intra-EU sourcing of intermediate inputs increased from 18% to 25% between 1995 and 2025, alongside growing dependencies on China for batteries and advanced electronics. At the same time, workers face significant changes in their jobs: nearly 80% of car manufacturing workers report substantial changes in their working environment, and around one-third experience these changes without training, rising to 40% among suppliers. The capacity to manage these transitions varies across firms. Large manufacturers have stronger training systems and mechanisms for anticipating change, while smaller suppliers and car sales firms have fewer resources. Workers who lose their jobs face significant and persistent earnings losses, highlighting the importance of strengthening access to training, worker support and transition policies across the automotive value chain.