Impact of Electrically Chargeable Vehicles on Jobs and Growth in the EU
July 10, 2018DownloadsDownload Article
This report analyses the impacts of electrically chargeable vehicles on jobs and growth in the EU and highlights the uncertainty about the transformation needed of the automotive sector. Often cited positive impacts of electrification are mostly based on optimistic assumptions. The European Commission estimates the impact of electrification to be negative on jobs according to its Impact Assessment accompanying the proposal on CO2 targets for the EU automotive sector.
A rapid switch to full battery vehicle (“BEV”) production within the EU will have serious structural implications for the sector – BEV production is less labour intensive with a high import share of components and key parts (e.g. batteries). Impacts will be concentrated in certain regions and parts of the labour force, including regions with industry clusters built around conventional powertrains or with a strong refining industry; small and medium enterprises that are highly specialised in certain elements of conventional powertrains; and unqualified or low qualified workers, who may face difficulty in acquiring the new skills and qualifications needed.
In addition to the impacts on the automotive sector, the transition poses challenges for the development of charging infrastructure and the grid. Public charging will have to be developed, and the electric infrastructure of houses will need to be upgraded to accommodate vehicle charging and the use of household appliances. The increased electricity demand requires an increase in the capacity of the grid.
Given the various implications, timing of the transition is key for the industry and policy-makers. The process towards electrification is very complex and would require further analyses.