Germany’s automotive original equipment manufacturers (OEMs) and suppliers are bracing for a substantial workforce transition that could reshape the industry landscape.
According to an analysis conducted by Strategy&, a global consulting firm affiliated with PwC, the direct automotive industry in Germany, currently employing 770,000 individuals, is anticipated to experience a 12% decline in total workforce demand by 2030, reducing the number of employees to 680,000.
This workforce reduction of 90,000 roles is attributed to several factors, including digitalisation, automation, relocation, and outsourcing of processes beyond Germany’s borders. Strategy&’s model predicts that approximately 260,000 out of the 680,000 roles will need to be newly filled by 2030, signifying a radical shift in workforce dynamics.
Retirement, e-mobility and competition
Three main catalysts are driving this transformation. Firstly, a significant portion of the workforce, notably the baby-boomer generation, will transition into retirement, accounting for around 90,000 roles. Secondly, industry disruptions such as the shift towards e-mobility and software solutions will render many current roles and skill profiles obsolete, affecting approximately 130,000 positions. Lastly, competition from other industries and natural fluctuations will prompt some talent to seek opportunities elsewhere, resulting in an estimated 40,000 vacancies.
Addressing the challenges posed by automation and shifting role requirements requires proactive measures. While traditional levers such as recruiting graduates, retaining apprentices, and attracting talent from alternative sectors remain viable options, the need for reskilling current employees is paramount. Strategy& suggests reskilling initiatives in areas such as battery engineering, software development, and artificial intelligence to mitigate workforce downsising effects.
Ameliorating the downturn
Despite leveraging these traditional levers, Strategy&’s model indicates that approximately 60,000 positions may remain unfilled in Germany by 2030. To bridge this talent gap, Strategy& advocates for a comprehensive approach dubbed the “6B approach”: Build, Buy, Bind, Borrow, Bot, and Bargain.
The “build” and “buy” measures focus on enhancing the workforce through upskilling and recruitment efforts, while the “bind” measure aims to retain high-potential talent by improving workplace attractiveness. Additionally, strategic partnerships with agencies and external talent providers (borrow), automation of manual processes (bot), and negotiations on regulatory requirements (bargain) are recommended to reduce the demand for new talent.
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“German auto sector forecasted to shed 90,000 jobs by 2030: Strategy& study” was originally created and published by Motor Finance Online, a GlobalData owned brand.
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