More than 60,000 jobs have been lost in the auto supplier sector across North America and Europe in 2025, as companies face challenges from declining electric vehicle (EV) production, rising tariffs, and overall weakened vehicle demand.
The Current Landscape
In a significant downturn, the auto supply chain is experiencing unprecedented layoffs, with over 60,000 positions eliminated in 2025 alone. This wave of job cuts follows a troubling trend that began in 2024, where European suppliers reported approximately 54,000 job reductions. The automotive sector, particularly those involved in electrification and related components, has been forced to adapt to lower-than-anticipated EV production rates, causing cascading effects through the supply chain.
Key Factors Driving Reductions
Industry analysts cite three primary causes for these widespread job losses:
- Slowed EV Production: OEMs have scaled back their EV manufacturing plans, leading to decreased demand for parts and components.
- Tariff Pressures: Rising tariffs have increased operational costs for suppliers exporting their products, further squeezing profit margins.
- Lower Vehicle Production: Ongoing production shortfalls, exacerbated by high material costs, have left many suppliers unable to sustain their workforce levels.
According to industry reports, such as those from CLEPA, the transition to electrification is also reducing parts content per vehicle, potentially worsening employment impacts unless new product lines are developed.
Areas and Roles Most Affected
The job cuts are most pronounced in regions with a high concentration of automotive operations, particularly Germany, the UK, and parts of Eastern Europe. Companies like Bosch and ZF have announced significant layoffs, impacting roles across production, engineering, and management. This restructuring often involves not only layoffs but also plant closures and voluntary redundancy schemes.
Compliance Impact
For corporate attorneys, CPAs, and compliance officers, these developments necessitate urgent attention to supply chain contracts and workforce management strategies. Companies should:
- Assess contractual obligations with suppliers facing layoffs.
- Review employee retention strategies in light of potential future reductions.
- Monitor evolving trade policies and tariff implications that may affect supply chain costs.
Continued updates and insights can be found in resources like the Automotive Manufacturing Solutions report, which is tracking these layoffs closely.