The once-in-a-generation upheaval currently sending shockwaves through Europe’s suppliers has multiple consequences, one of which has been to close the book on a key part of British automotive history.
Back in January, Dowlais, the parent company of driveshaft specialist GKN Automotive, was sold to American Axle. “This whole sector has been really challenged over the last 18-24 months,” Dowlais CEO Liam Butterworth told Autocar, and selling up will allow the company to “to navigate this structural shift in the industry".
GKN can trace its history back to 1759, when the Dowlais Ironworks Co was established in South Wales. What became Guest, Keen & Nettlefolds and then GKN has reinvented itself multiple times over the centuries, but this last move takes ownership out of British hands for the first time.
“The overall macro in the industry is changing,” Butterworth said on the company’s earnings call on 5 March. “There's a structural change taking place around tariffs, geopolitics, regionalisation, the different requirements from our customers and thus creating a strong headwind for a number of automotive suppliers.”
Last year, European automotive suppliers announced 54,000 job cuts – more than in the Covid years of 2020 and 2021 put together, according to data from the European Association of Automotive Suppliers (Clepa).
Among those numbers are 5550 at Germany’s Bosch, the largest automotive supplier, according to Automotive News's 2024 top 100 parts suppliers list.
Number two on that list, ZF Friedrichshafen, announced it would axe 12,000 jobs in Germany. Meanwhile, Continental is looking to lose 7150 jobs through global restructuring, while Schaeffler has said it wants to cut 4700 across Europe, 2800 of those in Germany.
Germany’s role as the region’s car-building heartland has meant many of the world’s global tier-one super-suppliers growing to vast sizes within its borders, so the country is being disproportionally affected as the pressures of electrification, China and a shrinking car market force restructuring.
Almost 19,000 automotive jobs (including at car companies) were lost last year within Germany, according to research from consultantcy EY. “The German automotive industry is in a massive and comprehensive crisis," EY automotive expert Constantin Gall said. “There has been a massive tightening of the cost screw".
In the UK, the sale of GKN is the biggest evidence of that upheaval to hit the supply industry, but there are job losses too. GKN’s last UK automotive parts plant shut in 2021 and Butterworth said in March that the company would also shut its electric powertrain research centre, established in 2017.
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