Trying to keep industry in Europe?
(Photo by John Cameron on Unsplash)

Trying to keep industry in Europe?

With sluggish growth, high energy costs and over regulation is their a risk that production moves out of Europe?

Summary: BMW has said its hatchback and small SUV electric Minis will be built in China. BASF recently announced that it was seeking permanent cost cuts in Europe, quoting “the triple burden of sluggish growth, high energy costs and over regulation”.

Why this is important: Electrification could become a meaningful driver of competitive advantage for many industries in Europe.

The big theme: Where industry is located, especially when a new plant is being considered, has always been a 'battle of the subsidies'. Companies understandably encourage countries or regions to compete. But, at the end of the day, it's often fundamentals that win out. Where does it make economic sense for manufacturing to take place, does the region have a skilled workforce, does it have good access to raw materials and end markets, and increasingly now, what does regulation look like and how cheap (or expensive) are energy costs.



The details


Summary of a story from The BBC:

BMW has said its hatchback and small SUV electric Minis will start being built in China. Plus, its electric Countryman model will be built in Leipzig, Germany. A UK transport minister has said BMW's decision to move production of electric Minis to China was "very unfortunate", but that she was "not concerned" about the future of electric car production in the UK.

Let's take a look at why this is important...


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