EVs Create a Catch 22 for the Industry
Daily Slideshow: Despite a growing worldwide effort to switch to electric vehicles, there are numerous impacts on the automotive industry that must be considered. For one, the automotive manufacturing and production jobs.
Growing Sales
Although consumers largely prefer vehicles with internal combustion engines, Electric Vehicle production and sales as a whole have been ramping up the last several years. In the United States alone, electric vehicle sales saw a 25-percent increase from 2016 to 2017 with nearly 200,000 units sold. To put things into perspective, however, 17 million new cars were sold last year making the EV vehicle segment a mere 1.2% of all new car sales. That said, there will be a push to increase EV production to 25% of all vehicles by 2030. But what kind of effect can that have on the automotive industry?
Studies Abroad
While the debates continue to roar over the actual environmental benefits of EVs, various studies are being conducted in an attempt to determine how an increase in Electric Vehicle production will alter the automotive industry. A recent study commissioned by German trade union, IG Metall, examined the manufacturing process of EVs and compiled data from some of Germany's largest vehicle brands (BMW, Daimler, & Volkswagen) to predict the impacts on manufacturing and production autoworkers. Despite the study focusing solely on the German auto industry, its findings are highly applicable to auto manufacturers worldwide.
It Begins in the Powertrain
The study indicates that there are currently 840,000 jobs provided by the German auto industry, which as of 2017 was the 4th largest automobile-producing country behind China, USA, and Japan. Of those 840k workers, 210,000 are tied to the manufacturing and production of powertrain components such as engines and transmissions. IG Metall claims that 35% or roughly 75,000 jobs related to the powertrain would be axed if the industry were to meet a mandate requiring 25% of the vehicles produced to be emissions-free.
Displacement & Replacement
EVs are said to contain only one-sixth of the powertrain components compared to that of an equivalent model fitted with an internal combustion engine, thus production times are substantially decreased. Unfortunately, these simplified production cycles will displace thousands of workers that will otherwise be unnecessary in getting cars rolling off of the assembly line. "By 2030 every second job in passenger car powertrain will be impacted directly or indirectly by electromobility," says IG Metall. It is true that new jobs related to specialized electronics and batteries will be created, but they pale in comparison to those lost on the ICE side of things.
The Auto Revolution
Obviously, a more aggressive implementation of EVs is going to see higher rates of workers being laid-off, but if we apply the findings from this German study to the American auto manufacturers, we could easily see 200,000+ employees looking for a new job in the coming years as the US auto industry is roughly double that of Germany. Such a drastic shift in the industry can have widespread political and economic implications that likely have not yet been evaluated. Much like modifying a vehicle, the alteration of one component of the auto industry is bound to have a ripple effect that can be felt across the board. Will the advantages of this paradigm shift outweigh the negative connotations? Time will tell if the evolution of the Electric Vehicle will result in an industry-wide automotive revolution.
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