The transition from the automotive industry to sectors with higher growth prospects in Germany is gaining momentum, reports the Financial Times. Suppliers are developing areas such as medical technologies, robotics, and the defense industry.
According to data from the German automotive industry association (VDA), referenced by the Financial Times, the country's automotive industry will lose another 125,000 jobs by 2035, with suppliers being at the greatest risk of layoffs.
According to a survey conducted by the consulting firm FTI-Andersch in November, three out of four German suppliers affected by structural changes in the industry are already redirecting their activities to other sectors.
As FT reports, the defense industry is generating the most interest, as increased government spending in European countries has raised expectations for rapid development in this sector.
One of the largest suppliers of auto parts, Bosch, is seeking to diversify its business. Against the backdrop of problems in the traditional automotive business, the company has announced plans to cut 22,000 jobs worldwide.
However, Bosch recently announced an expansion of its activities in the robotics sector, which, according to company executives, could become a multi-billion euro business over time.
Last year, the Stuttgart-based company's revenue was 91 billion euros.
According to the publication, even Volkswagen, the world's second-largest automaker by production volume, is seeking collaboration opportunities with defense companies to transfer factories that are no longer needed for vehicle production.
The article notes that Volkswagen has been in talks with the Israeli manufacturer of the Iron Dome missile defense system regarding the use of its plant in Osnabrück.
Mercedes-Benz recently signed a memorandum of understanding with the startup Tytan, which produces unmanned aerial vehicles, to supply vehicles for mobile air defense units.
For Sembach, experience in meeting the stringent requirements of the automotive industry has become an advantage in transitioning to medical equipment production. The company reports that the transition from the German automotive industry to medical equipment production has already yielded certain results, with Sembach's revenue reaching a record 23 million euros last year.
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