European automotive industry faces structural shifts and labor reforms

The European automotive industry is facing significant structural shifts. Bosch's works council has warned that 40,000 jobs in Europe are directly tied to internal combustion engines, calling for the EU to reconsider the 2035 ban on new combustion engine vehicles and to prioritize subsidies for European-made components.

Volkswagen is undergoing major internal changes. The company is planning a comprehensive wage system reform by 2027 to unify pay structures for workers and employees, a move supported by IG Metall to modernize the industrial workplace. Additionally, former works council leader Bernd Osterloh has emphasized that Volkswagen must move away from independent development and increase technological partnerships, particularly in software and autonomous driving, to remain competitive.

On the product front, Volkswagen's new electric ID. Polo has seen strong initial demand with over 30,000 orders, leading to production challenges. The company is also diversifying its lineup, with plans for a new hybrid Golf and a future transition to a fully electric Golf model toward the end of the decade.