Suppliers of internal combustion engine parts face uncertainty due to electrification

European auto parts supplier companies that manufacture internal combustion engine components are starting to face serious challenges. This is because several countries are already preparing to switch to electric cars.

The crisis is a serious challenge because the potential for electric vehicle sales is still very high. So they have to do development including investing in large amounts to answer future needs.

But at the same time, there has been a decline in revenue due to slowing sales of conventional vehicles. Several large companies have felt the negative impact of the change.

The situation is made worse because many European countries are planning to completely ban internal combustion engines by 2035. As a result, some companies have evolved even though in unpleasant ways.

One of them is Evtec Aluminum, a supplier of engine components for Jaguar Land Rover. The company managed to survive because it was taken over by the automotive group led by David Roberts some time ago.

Under his leadership, the company was able to manufacture complex aluminum components. This capability will almost certainly attract the interest of electric car manufacturers in the future.

Other companies such as Vitesco Technologies Group AG of Germany are looking to shift their focus from combustion engines to electricity. They hope to control 70 percent of the vehicle market by 2030.

To get it they will divide their focus into 2 divisions including electric car parts. Meanwhile, other divisions are tasked with developing internal combustion engines with higher technology and earning large revenues when the market segment declines.

Because electric cars require fewer components than combustion engines, some manufacturers have warned of mass layoffs. For example, Stellantis is in the process of shifting its engine factory in Tremery, France to manufacture electric motors.

In the process, the company has reduced its workforce from 3,000 to only 2,400. This number is expected to decrease again due to fewer types of work.

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