According to a new Policy Brief, 135 Austrian companies supply German VW plants, with 6,300 jobs directly dependent on VW orders. These jobs could be affected by cutbacks.
The German car industry is losing significant market share to Chinese electric car manufacturers. German carmakers, including VW, have not responded sufficiently to changing customer needs and have been too slow to develop new technologies. Volkswagen has now announced three plant closures in Germany by 2026. But what does this mean for the automotive industry in Austria?
The Austrian automotive industry is highly dependent on exports. Every year it produces goods worth €28.5 billion, 85% of which are exported. A full 65% of these exports go to Germany. So it is only logical that the announced plant closures and job cuts in neighbouring countries will also be felt in Austria. In a recently published research brief by CSH, together with ASCII and the Logistikum – University of Applied Sciences Upper Austria, the economic dependence of the domestic automotive industry on VW has now been examined in more detail.
135 DOMESTIC COMPANIES AND 6,300 JOBS LINKED TO VW
The researchers identified 135 Austrian companies with direct economic links to VW. To do this, they not only used high-resolution and detailed company data, but also a newly developed analysis method to automatically extract company relationships from an extensive archive of websites.
“According to our calculations, 6,300 jobs are linked to business relationships with German VW plants. Most of these companies are located in the automotive cluster in Upper Austria and Styria,” explains CSH researcher and ASCII director Peter Klimek. More optimistic and pessimistic estimates range from 3,600 to 10,900 jobs.
COMPONENT SUPPLIERS DIRECTLY AFFECTED
However, not all suppliers are affected to the same extent by the VW crisis. In the short term, the economic impact is likely to be felt most acutely by component manufacturers. Machine suppliers, on the other hand, are more likely to suffer long-term losses. For example, through cancelled investments in new plants and the associated loss of growth opportunities.
THE TIP OF THE ICEBERG
“Ultimately, the current crisis at VW is just the tip of the iceberg. EU-wide structural reforms and a clear prioritisation are needed to prevent far-reaching losses in value creation throughout the industry and to narrow the gap to China in the next technological leap,” says Markus Gerschberger, Deputy Director of ASCII and Professor at the University of Applied Sciences Upper Austria. These include Reducing energy costs, increasing automation and boosting technological competitiveness.
About the policy brief
The policy brief “How Dependent Is the Austrian Automotive Industry on Volkswagen?,” by Mitja Devetak, Ladislav Bartuska, Jakob Haussteiner, Georg Heiler, Maximillian Hess, Klaus Friesenbichler, Markus Gerschberger, Hernán Picatto, and Peter Klimek, can be downloaded here.
