The global automotive industry is facing serious challenges in the transition to electric vehicles, leading to a revision of strategies and production cuts in many countries, reports the Baltimore Chronicle, citing Automobilwoche.
European automakers such as Volkswagen, Mercedes-Benz, and Volvo are reducing their electric car production volumes due to decreased demand and strong competition from Chinese companies. Specifically, Volkswagen reports underutilized factories intended for electric vehicle production, resulting in significant costs.
Chinese manufacturers like BYD are actively expanding their presence in the European market by offering more affordable electric vehicle models. This adds pressure on European competitors, who struggle to produce budget electric cars.
In the United States, Panasonic, a key battery supplier for Tesla, faces pressure to accelerate production at its new Kansas factory. This is linked to Tesla’s desire to secure tax incentives that require the use of domestically produced batteries.
Japan is also encountering difficulties in electric vehicle battery production. Despite substantial investments, the country is losing ground in the global market due to financial challenges and competition from Chinese firms.
Moreover, global logistics issues, including the crisis in the Red Sea, complicate the supply of electric vehicle components, causing production halts at some European plants.
In response to these challenges, some countries, including Italy, are calling for a review of the EU’s environmental policies to avoid “deindustrialization” and preserve the competitiveness of European industry.
Earlier we wrote that China tightens trade pressure with tariffs on POM polymer imports.