Europe's electric car revolution risks job loss backlash, unions warn

by Arthur Neslen | @arthurneslen | Thomson Reuters Foundation
Monday, 6 September 2021 06:00 GMT

Technicians work in the assembly line of German carmaker Volkswagen's electric ID. 3 car in Dresden, Germany, June 8, 2021. REUTERS/Matthias Rietschel

Image Caption and Rights Information

Without alternative jobs or training opportunities, the threat of a redundancy wave raises hard questions about the social costs of transitioning to a low-carbon economy

* Millions of jobs are on the line, warns union leader

* Unemployed auto workers could become 'target for populists'

* Unionisation of Tesla factory in Gruenheide seen as test case

By Arthur Neslen

BRUSSELS, Sept 6 (Thomson Reuters Foundation) - Andrea Knebel has worked at Bosch's motor assembly plant in Buehl, Germany, for two decades but her post could be one of 700 the firm says it will cut by 2025 as Europe accelerates a push away from fossil fuel transport and towards electric vehicles.

The European Union has proposed an effective ban by 2035 on sales of new petrol and diesel vehicles, which are responsible for nearly 15% of Europe's planet-heating carbon emissions.

Fewer auto-workers - with a much higher technical skill-set - will be needed in the new electric car sector, threatening mass layoffs in an industry that directly and indirectly employs 14.6 million people, or about 7% of Europe's workforce, according to the European Automobile Manufacturers' Association.

Knebel, a trade unionist and works council member at Buehl, has been representing workers - some too paralysed by fear to even speak - in talks with the management of car parts supplier Bosch. But even her own white-collar position in change management might not be safe.

"I'm really worried," Knebel, 55, told the Thomson Reuters Foundation. "In four years, I'll nearly be 60 years old and my girl will maybe be studying by then."

Few 'green collar' retraining opportunities have so far been offered at Bosch's Buehl and Buehlertal factories, she said.

Unions believe that up to half of the 3,700 employees in the two plants could ultimately lose their jobs, when job-shares, part-time and temporary work contracts are taken into account.

The cuts are part of a company redundancy wave that is expected to lay off thousands of workers in Germany, although a Bosch spokesperson said it would be done in a way that was "as socially acceptable as possible".

Building a diesel power-train system needs 10 times more workers than manufacturing an electric one, the official added.

Without alternative jobs or training opportunities offered, redundancies on this scale raise hard questions about the social costs of transitioning to a low-carbon economy.

Economists have increasingly argued that shifting to greener products and business models will be positive for jobs and growth.

But older and unskilled workers who cannot relocate or are not given the chance to retrain will need special help, labour rights activists say.

Knebel, who is considering looking for work as consultant, said she didn't know if she would succeed "because of my age".

Europe's unions say they are strong supporters of a rapid shift to electrified transport - which could lead to only a small net loss of 35,000 jobs by 2030 when new clean energy employment is taken into account, according to one recent study.

The research by Boston Consulting Group predicted that new plants making battery cells to power electric vehicles - sometimes called "gigafactories" - would be built in Europe.

In addition, more than 100,000 new jobs would be created in manufacturing, installing and operating charging infrastructure, it forecast.

But some union officials believe those findings are optimistic, and point to sectors that could be devastated.

Technicians work in the assembly line of German carmaker Volkswagen's electric ID. 3 car in Dresden, Germany, June 8, 2021. REUTERS/Matthias Rietschel

'BACKLASH' RISK

"Millions of jobs are on the line if there isn't a clear plan for how the transition is to be managed," said Judith Kirton-Darling, deputy general secretary of the industriAll union, which represents 50 million workers globally.

"A just transition, if it's left as empty rhetoric and promises, will simply feed a backlash," she told the Thomson Reuters Foundation. "That's a massive concern for us."

Such a scenario could stir a broader social reaction similar to France's "gilets jaunes" (yellow vests) protest movement against fuel price hikes which brought parts of the country to a standstill in late 2018 and 2019, said Kirton-Darling.

"People who are anxious and feel economically insecure (are) the main targets for populists," she added.

Unions fear the hidden agenda behind many of the expected job cuts is the acceleration of an industry shift towards eastern European factories, where wages are relatively low.

In August, British workers were balloted on strike action over plans by private equity group Melrose to shutter the GKN automotive plant in Birmingham and move work to Olesnica in southwest Poland, with potentially more than 500 redundancies.

Nick Miles, a spokesman for Melrose, blamed the slated closure of the plant, which makes driveline systems, on a sharp fall in customer demand for petrol and diesel engines, intensified by the trend in vehicle electrification.

Sigrid de Vries, secretary general of the European Association of Automotive Suppliers (CLEPA), said new jobs in battery-cell manufacturing would not create enough employment to compensate for those lost in other areas of the auto industry.

About 40% of new jobs in the e-mobility sector will need four years of training and a high education level, with knowledge of chemical processes and data analysis, she told a European Trade Union Institute (ETUI) webinar in June.

According to Knebel, no more than 50 workers at Buehl have so far been offered retraining by Bosch.

Technicians work in the assembly line of German carmaker Volkswagen's electric ID. 3 car in Dresden, Germany, June 8, 2021. REUTERS/Matthias Rietschel

UNIONISED REVOLUTION?

In a sign of growing concern, European unions, employers and environmental groups issued an unprecedented joint call to the EU in July for more resources to back a just transition. "This is an industrial revolution of historic proportions," said their letter, which called for the up-skilling and retraining of 2.4 million auto workers.

In Germany alone, a Volkswagen study predicted jobs in car manufacturing would fall by 12% as the electrification process advances this decade.

That is despite seven lithium-ion battery-cell gigafactories planned in Germany, more than in any other European country.

France's 57,000-strong auto-engine workforce will also shrink by up to 70% by 2050 without just transition measures, according to a recent report by former French environment minister Nicolas Hulot's Foundation for Nature and Mankind.

Unions are watching a $7-billion Tesla electric vehicle gigafactory expected to open in Gruenheide, Germany, later this year as a test case, not least because of the reputation of company CEO Elon Musk.

The tech billionaire has in the past used social media to threaten employees with losing their stock options if they formed a union.

"It will be tough to organise these new plants but we have to do it," Christian Brunkhorst, a board member for Germany's IG Metall, a manufacturing workers' union, told the ETUI event.

"It's an absolute must that we keep the auto value chain unionised, in order to keep working conditions at a good level," he added.

Tesla did not respond to a request for comment.

Related stories:

UK regions push for green transition done 'by the people, for the people'

Clean energy shift a chance to 'raise' people and the economy, Biden says

'Can I afford it?' Workers fear squeeze from green energy transition

(Reporting by Arthur Neslen. Editing by Megan Rowling. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit http://news.trust.org)

Our Standards: The Thomson Reuters Trust Principles.