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November 21, 2024 9:27 am

November 21, 2024 9:27 am

Home Business Closure of Audi Brussels Highlights Europe’s Struggle with De-industrialisation

Closure of Audi Brussels Highlights Europe’s Struggle with De-industrialisation

by Richard Parks

Audi’s decision to close its Brussels plant in February 2025 reflects a troubling trend affecting Europe’s economy: de-industrialisation. Euronews spoke with workers impacted by this closure to understand the real-life effects and explore potential solutions to revitalize European industry.

“We’re furious, because we’re being discarded,” says Stavros, a union representative who has worked at Audi’s Brussels site for nearly 40 years. His frustration is shared by many as the German carmaker moves to shut down the plant, citing declining sales of electric models and high operational costs. Audi’s Q8 e-tron electric SUV production will be relocated to Mexico, leaving 4,000 employees—both direct and indirect—facing an uncertain future, especially since no buyer has been found for the plant.

But Audi’s closure is just one example of a broader crisis in Europe’s car industry, which has been plagued by sluggish growth and fierce competition from Chinese manufacturers. Since the beginning of 2024, multiple carmakers have announced cuts, layoffs, and plant shutdowns, including Stellantis in Italy, Michelin in France, and Volkswagen in Germany, which is planning to close three factories for the first time in its history. This wave of closures underscores a deeper, long-standing issue in Europe: de-industrialisation, a process where the share of industry in a region’s economic output shrinks.

From 1991 to 2023, the share of industry in Europe’s GDP fell by almost 18%, from 28.8% to 23.7%, according to the World Bank. The causes are multifaceted: automation, offshoring to lower-cost countries, the shift towards a service-based economy, declining purchasing power, rising energy costs, and intense competition from economies like China and the United States.

This has led to significant job losses in the industrial sector. Between 2019 and 2023, Europe saw a reduction of 853,000 industrial jobs, according to the European Trade Union Institute.

Basil, a 30-year-old worker who has been on Audi’s production line for five years, shares a sense of betrayal. “I feel a sense of rebellion because I’m losing part of my future, but we’re not bankrupt,” he says, lamenting the closure despite Audi posting an operating profit of nearly 6.3 billion euros in 2023. “We don’t understand it; we think it’s unjust,” he adds, criticizing the company’s prioritization of profits over workers’ livelihoods.

In response to de-industrialisation, Europe is attempting to shore up its industrial base by investing in green technologies. The European Green Deal’s industrial plan seeks to promote companies transitioning to carbon neutrality while ensuring resource independence. The plan focuses on securing access to critical metals and supporting industries committed to achieving net-zero emissions.

While these initiatives are positive, experts like Bertrand Candelon, Professor of International Finance at UCLouvain University, point out that they require massive investments. “Mobilizing 800 billion euros, as recommended in the European competitiveness report by Mario Draghi, is a huge task,” says Candelon. Given the state of public finances, this could primarily benefit larger states with the financial means to invest in carbon-neutral industries.

Meanwhile, both China and the United States continue to pour substantial resources into their industries, further consolidating their hold on international markets, including Europe. Candelon argues that this global race for industrial dominance is increasingly resembling a trade war, with Europe under immense pressure to catch up while pursuing its ambitious carbon-neutrality goals by 2050.

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