One of the biggest layoffs in Germany’s automotive industry, Bosch plans to eliminate 13,000 positions as the sector struggles with low demand, overcapacity, and growing competition from China. The largest auto supplier in the world announced on 25 September that all of the layoffs would be made by its own employees, which accounts for roughly 10% of its workforce in Germany and 3% worldwide.
According to Le Monde, the layoffs are intended to save €2.5 billion a year in its auto parts division. Bosch, a manufacturer of sensors, brakes, and steering systems, stated that the cuts were required to match production to changing demand around the world.
Bosch’s head of industrial relations, Stefan Grosch, informed reporters that the company’s products are becoming much more popular outside of Europe. The brand must align with the locations of its customers and marketplaces.
Bosh’s Challenging Times in Europe
The action highlights the pressure on the biggest economy in Europe as its main auto industry battles the switch to electric vehicles. Le Monde claims that slow EV sales, overcapacity in conventional components, and a growing price war in China that has reduced supplier profits have all hurt Germany’s auto industry.
Bosch’s head of electrified motion, Marco Zehe, acknowledged that the company had misjudged the rate of change. He claimed that “electromobility has not taken off as quickly as forecast.” “That indicates that we have a lot of excess capacity, especially in Germany and Europe.” Since last year, Bosch has already announced 9,000 job layoffs.
Schaeffler and Continental, among other suppliers, have also reduced their workforce by thousands of workers. Volkswagen has stated that it plans to reduce its staff in Germany significantly, while Porsche slowed its deployment of electrified vehicles last week due to insufficient demand.
Bosh Struggling to Deal with Europe’s Fading Economy
As a result of the transition, Bosch’s German operations, which were previously a cornerstone of global supply, are now disproportionately susceptible to increased cost bases and weakening European demand. “We stand by it as a location and stand by Europe and are doing all we can to continuously improve our competitiveness by our own efforts,” Grosch said, emphasising that Germany remained “central” to the company’s future.
Representatives of the workforce pledged to oppose the reorganisation. The Bosch Mobility Works Council’s chairman, Frank Sell, called the layoffs “historically unprecedented”. He charged the group with betraying the confidence of the workers who had contributed to the company’s success. The union is requesting guarantees that Bosch won’t shut down entire German facilities, a worry that has stoked dissatisfaction among employees in industrial hotspots like Baden-Württemberg.
With hundreds of thousands of workers, Germany’s automobile industry has been a major contributor to its export power. However, suppliers and manufacturers alike are being forced to reconsider their footprints due to the twin challenges of electrification and global competition. According to Bosch’s announcement, the adjustment will be more severe than most people had expected.
Local economies that are already struggling from past layoffs will be affected by the employment reduction. The layoffs, according to analysts, highlight a structural change: German auto suppliers run the risk of losing market share as automakers prioritise regional sourcing and as Asian competitors take control of EV supply chains.
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•Layoffs aim to save €2.5 billion •Bosch says its products are gaining •Slow electric vehicle adoption, •Other giants like Schaeffler, |
