The cuts represent about 10% of Bosch’s total workforce in the country, and 3% of its staff worldwide. Workers’ representatives vowed to resist the cuts, labelling them ‘unprecedented.’
German industrial giant Bosch said Thursday, September 25, it would cut 13,000 jobs, mostly in its auto unit, in the latest blow for the country’s ailing car sector.
The auto industry in Europe’s biggest economy has been hammered by fierce competition in key market China, weak demand and a slower than expected shift to electric vehicles.
The cuts, all of which will take place in Germany, represent about 10% of Bosch’s total workforce in the country, and 3% of its staff worldwide.
Bosch − the world’s biggest auto supplier, making everything from braking and steering systems to sensors − said the layoffs were needed to help make annual savings of €2.5 billion in the group’s car unit.
There’s more to this than JUST that. Not that you’re wrong of course.
China subsidizes heavily because they want to be the only relevant player in the global EV market. These cars would cost closer to their non-Chinese counterparts if China wasn’t doing this.
In global economics, this is considered unfair, and is usually retaliated against via tariffs.
Why wouldn’t we let them in too drain the Chinese economy then. We would “win” in the short term by getting vehicles with fewer emissions while siphoning money out of the Chinese economy. Later when they could no longer afford to offer the vehicles at such a low price another company would step in with a superior product. At least that’s what I’ve been taught about how capitalism works. Was that all a lie?
The Chinese government can afford to pay their manufacturers 10-20k euros per car indefinitely, there’s no real limit to how much money they have. They’ll continue until every western manufacturer is bankrupt.
I know you probably realize this, but no. It’s not how capitalism works in the real world. In the real world, when you have products that cost billions to develop before production, it’s nearly impossible for a new company to be competitive against a monopoly. And if the Chinese give away semi-free cars to everyone for a decade, everyone else goes bankrupt and they have a monopoly. OR other countries start sacrificing other budget items so they could subsidize their domestic car manufacturing and we just have… even more cars on the roads and less public transit, less walkable cities. Yay!
The situation is a lot more complicated than that. On big enough scales (globally), it’s not actually about the money at all. The countries can literally just print arbitrary amounts of paper money, so money is no concern at all.
What is a concern, however, is everything else. There’s jobs, the way that countries perform on the international stage (geopolitical aspects), future prospects, people’s quality of life, and much much more. All of that matters and is not really mapped to economic numbers such as money. That’s why these micro-economic attempts fail when trying to apply them to the global level.
To be fair, everyone should subsidize their production. That makes products cheaper for everyone and life better for everyone.
The way i see it, the fact that this is considered unfair is the problem. We should be doing the same thing instead of bashing against that.
We could subsidize our production for example by giving people cheaper housing, so they can afford to earn less in their jobs which makes labor cheaper and therefore companies more competitive.
If you subsidize everything, you have to raise taxes on everyone. Makes it a zero sum thing.
You subsidize particular industries where you need growth. Most of the western world does not want more cars on the roads, they want more people to use public transit, hence no automotive subsidies in most European countries. And we DO have EV subsidies in a lot of countries! But we don’t have them just for European manufacturers - rather, we treat all manufacturers equally for EV subsidies, because it’s generally the buyer who gets the subsidy. EU car manufacturers still need to be profitable on the cars they sell, whereas the Chinese manufacturers can make money by selling cars for less than they cost to make (and we’ve in fact all paid for it already, since Chinese tax money comes largely from shit they’ve sold to the west).
USA is different, they want more cars on the road, but they also want all the cars to be American, so they do subsidies (or at least have done before) AND tariffs. That’s just protectionism and sucks for consumers. If you’re subsidizing your local industry, there’s no reason to also tariff foreign industries, unless you want to limit consumer choice on purpose.
Ok so from what i could see in your comment, you’re arguing very much from the point of view of macroeconomics. Your explanation feels like textbooks macroeconomics, at least to me.
The issue i have with your stance is that it’s all too much focused on economics (who produces cars and sells them and such), but geopolitics is not just about economics. Not at all, in fact. Ultimately, if we want to have a future, we will have to live with our neighbors for a very long time. (The future is a very long time). To do this, we need to be on good terms with the other countries. What i’m not seeing in your comment is how this thought flows into your text. Where is the relationship between countries reflected in the market situation? Where is the trade relationship based on a mutual understanding of mutual interests? Where is the equality in the game?
I think that macroeconomics must be a side aspect of geopolitical contemplations, in other words, countries should strive to balance their trade relationship not for economic prosperity or necessity, but instead to respect international balances. That is not “protectionism”, it’s just making sure that the market isn’t in eternal turmoil because of a series of disruptions from aggressive competitors.
Whether you subsidize the companies in your country or not is ultimately a choice that every country makes for themselves. It should also be noted that a lot of subsidies are very indirect, so it’s difficult to say whether you’re even subsidizing the auto industry or whether you’re subsidizing your mining industry or your housing economy. Like, if you provide cheaper housing to your citizens, that lowers the cost of living, which means people can afford to earn less and still live well, which means companies can pay lower wages, which makes companies more competitive. Is this a subsidy to the auto industry or not? It’s hard to say. Ultimately what countries must agree on is international relationships, while internal affairs are ultimately a choice that every country makes for themselves.
You’re right that this is geopolitical too: China is on the offensive. They’re trying to ensure the west (EU at least - USA is going to end itself anyway and Canada is too small to count on its own) is completely dependent on them. I’m of the opinion that countries should try to get along without one of them forcing the others into submission. But China is not being a diplomatic or trade partner in good faith.
As it is, I think it’s fair to tariff them where they’re trying to attack us specifically. There are also a lot of industries we’ve already lost because of the cost of labor here vs there - I don’t see any need to tariff those, I’m not Trump. I just want to see Europe protect the industries it’s still good at because otherwise we’ll be completely broke in a few decades if we have neither goods nor services to sell. Or we may all have to live like the Chinese do - get rid of some workers rights, reduce wages, etc - to stay competitive. Maybe start doing the 996 work schedule?
It’s a complex subject, right? From a consumer’s perspective, you could have a cheaper car, but your government won’t let you (by putting tariffs on them, or just straightout banning them) because China is not playing fair. As a consumer you are paying a price because of your ideology. I don’t know if everyone will want to do that.
And on the other hand, from the Chinese government’s perspective, they aren’t going to care if you think they are fair, as long as things are working out for them. If subsidizing means better product and/or markat dominance, why won’t they keep doing that? There are markets that are more ideologically aligned with them willing to take their products.
So what? Their economic model is able to churn out better product at lower prices, and the useful idiots in the West (you) cheer because you get worse deals.
I don’t care what “global economics” says. Have you seen the global economy? Do you think you’re a player, or just another pawn (useful idiot)?
Now, run along and go be average somewhere else. I’m genuinely tired of arguing with you people.
Their economic model is lose money on every car because the government is backing them.
They now owe 2.25X in debt more than the company is worth.
Subsidies designed to bankrupt the competition isn’t a better economic model
If these subsidies work so well, why don’t we use them too?
https://english.cw.com.tw/article/article.action?id=4164
Because the Chinese auto industry is imploding.
You’d have a point if the West could churn out competitive EVs.
Gonna block you now. I’m sick of stupid people and it’s a shame how many morons agree with you.
More reasons for me not to take the crowd seriously!
Sure buddy, the highest quality stuff is from TEMU.
If it looks like a car, it’s a car, right?
The west churns out BETTER EVs in many metrics. They just cost more because they’re not subsidized.
If we allow the Chinese to bankrupt every other manufacturer using subsidies, guess what, they’ll hike the prices 2-3x at least.
This is because at least here in the EU, governments want more people to use transit and fewer new cars to be sold, so they won’t subsidize domestic car production. We even got a brand new car registration tax here as well as an annual road tax here in Estonia, do you consider that a bad thing too? Since it negatively impacts people’s ability to buy more new cars…
Maybe understand the very basics of trade wars first lol
They’re that cheap because the chinese government pays for them to be that cheap. It also helps that they exploit their workforce as much as possible, but they still wouldn’t be as cheap as they are without the subsidies.
Oh my fucking god, it never ends with you morons.
So what if the chinese government pays for them to be cheap? Government intervention is literally part of their econony.
You, in typical dipshit fashion, don’t recognize how you’ve been convinced to hate them simply because they can compete with your rulers.
Instead of recognizing how you’re being played for a fool, you double and triple-down with all the other useful idiots.
I’m glad I can see it for what it is, because most of you are genuinely to stupid enough to do so yourselves.
Ignored.
LOL. I thought you blocked us?
Good luck with your Chinese EV when you need parts and the company no longer exists. Three years from now.
This is called drop shipping, and we get cheap junk that breaks from China every day.
There was no value judgement in mine (or the other guys) comment, that’s entirely your victim complex. Of course I would rather china not try to destroy our local markets but that is very very low on the list of things to hate the ccp for and I can’t say it’s fundamentally morally wrong in the world we live in either.
It’s just a fact that it’s subsidized and your propaganda that it’s cheap because china is just better at manufacturing is a flat out lie.