The crisis of the European car industry: electric vehicles, duties and loss of markets

The European automotive industry is experiencing a deep crisis caused by rising fuel prices, the popularity of electric vehicles and increased Chinese competition. 

Major car companies such as Volkswagen, BMW and Mercedes-Benz have started to cut staff due to falling profits. Europe's technological lag in the production of electric vehicles reinforces the problem. Despite EU subsidies, the share of electric vehicles in 2024 decreased to 13.6% from 14.6% a year earlier, while in China it is aiming for 50%.

Europe, trying to strengthen the electric car sector, is weakening the position of cars with internal combustion engines, but cannot overtake China in a new niche. Trade conflicts with the United States and China have worsened the situation: 25% duties on German exports have become a blow to manufacturers and suppliers. Key markets such as China and Russia have been lost: Beijing supports local brands, and the break with Moscow has been costly.

The European automotive industry is facing economic and geopolitical challenges that require a review of strategies to remain competitive in a rapidly changing world.