(By Observer Net, Zhang Jiadong, Editor: Gao Xin)

On October 1st local time, ZF, a German automotive supplier, announced on its official website that according to the restructuring agreement reached with the German Works Council and the union IG Metall, the electric powertrain technology department of ZF will lay off about one-quarter of its staff by 2030.

ZF official website

This department is the largest in terms of employment and sales within ZF, with approximately 30,000 employees, mainly producing electric, conventional, and hybrid power systems. This means the number of layoffs will reach 7,600 people.

The report states that this plan is part of ZF's previous announcement to cut 14,000 jobs in Germany. At that time, ZF revealed the reasons for the layoffs as weak demand for electric vehicles globally and the impact of global trade tensions.

In addition, analysts believe that a series of costly acquisitions made by ZF over the past decade have increased debt, which is also one of the factors. In 2020, ZF spent $7 billion (approximately 49.84 billion yuan) to acquire the American brake system company WABCO.

This pressure is more directly reflected in financial data. In 2024, ZF's total net liabilities amounted to 10.5 billion euros (approximately 87.57 billion yuan), an increase of 5% compared to 2023; combined sales were 41.4 billion euros (approximately 345.2 billion yuan), a decrease of 11%; and after-tax net loss was 1.02 billion euros (approximately 8.5 billion yuan), turning from profit to loss compared to the same period last year.

The company stated that while making large-scale layoffs, it will also shorten working hours and delay wage increases to help reduce costs by 500 million euros (approximately 417 million yuan) by 2027.

Reuters reported that with this layoff, ZF's electric powertrain department will stop developing electric vehicle-related products and shift investments to technologies such as plug-in hybrids.

Mathias Miedreich, the newly appointed CEO of ZF, who took office on October 1, said, "This is a joint effort to make our products more competitive in cost while increasing revenue." Before taking up his new position, Miedreich served as the head of the electric powertrain department.

Several foreign media outlets mentioned in their reports that ZF's layoffs highlight the pressures faced by the German automotive industry. In addition to ZF, other traditional automotive suppliers such as Bosch, Continental, and Schaeffler have also taken similar measures. Recently, Bosch announced plans to lay off approximately 13,000 employees.

German Automotive Industry Will Lay Off Nearly 100,000 People by 2030 - Bloomberg

According to the German Association of the Automotive Industry (VDA), the German automotive industry has laid off more than 55,000 people since 2023, with suppliers being the most severely affected.

It is worth noting that ZF itself remains optimistic about this layoff. Achim Dietrich, the chairman of the ZF union, stated that although the number of layoffs is large, it is important that the passenger car powertrain, as the core business of the company, will continue. "This reshaping of the department sends a signal to companies outside ZF that 'Made in Germany' technology and products have a good future."

However, in reality, the challenges facing the European automotive industry are not just the slow progress of electrification, but rather the difficulties in electric vehicle technology.

Data from the European Automobile Manufacturers Association show that by August, the registration of pure electric vehicles in the EU, UK, and EFTA countries increased by 26%, and plug-in hybrids by 28%, while the overall market growth was only 0.4%. This indicates that the European automotive market is shifting toward an environment dominated by electric vehicle demand.

Looking at the Munich Motor Show (IAA 2025) held in August this year, the real pressure on European automakers and suppliers comes from their slow transition and the technological gap in electrification when facing competition from the Chinese automotive industry.

Especially in the field of battery power, many of the autonomous battery manufacturers supported by Europe in recent years have failed to meet the needs of local automakers, leading to major European automakers such as BMW, Volkswagen, and Mercedes turning to Chinese or South Korean companies for procurement.

Additionally, high costs are also hindering the transformation of the European automotive supply chain. The European Supplier Association (CLEPA) stated that the current costs faced by suppliers in the region are 35% higher than those of global competitors.

According to Bloomberg, currently, European suppliers are calling for new rules to ensure that cars produced in the region use a large number of locally manufactured parts.

Benjamin Krieger, Secretary General of CLEPA, said, "Not taking action means the future of the automotive industry will not be born in Europe. This not only leads to factory closures but also threatens the social structure of the automotive industry and Europe's technological sovereignty."

This article is an exclusive contribution from Observer Net. Reproduction without permission is prohibited.

Original: https://www.toutiao.com/article/7556887222947938868/

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