Speaking at the Eurometal Steel Day & YISAD Flat Steel Conference held at the Istanbul Marriott Hotel Asia on Tuesday, March 24, in cooperation with SteelOrbis, Cosmin Bakai, global director of raw material supply chain development at automotive safety components manufacturer Autoliv, stated that the European automotive components sector is under pressure from rising Chinese competition, increasing imports and geopolitical uncertainties. Mr. Bakai indicated that global light vehicle production is expected to grow by around 1.3 percent by 2030, while growth in Europe will remain much more limited, with the market generally displaying a stagnant outlook.
Global automotive market - growth to remain limited
Commenting on the sectoral outlook, Bakai said that annual global vehicle production and sales stand at around 100 million units, but production is not expected to return to pre-Covid-19 levels. From a European perspective, he emphasized that the market is gradually shrinking, noting that exports of light vehicles from Europe are showing a flat or weak trend, while import pressure is increasing. Bakai also highlighted that European light vehicle production is contracting due to imports, traditional EU-based manufacturers are losing market share, and China is steadily gaining a larger share of the global market.
Chinese investments in Europe and scale dynamics
Addressing the investment plans of Chinese automotive manufacturers in Europe, Mr. Bakai said that new facilities are being planned in countries such as Italy, Poland, Hungary, Spain and Turkey. However, he underlined that these investments will initially be relatively small in scale. According to Bakai, Chinese players typically start with plants of around 50,000 units in Europe, then move to assembly structures of 100,000 units, while full-scale facilities emerge at capacity levels of around 300,000 units. Therefore, he noted that such investments may not immediately generate large tonnage demand in components, safety equipment and steel processing, and that it will take time for Chinese players to establish themselves in local markets.
Component trade outpacing vehicle trade
Bakai stated that the main pressure stems not only from vehicle trade but also from the transformation on the components side. He pointed out that global component trade is growing much faster than the vehicle market, adding that the volume of China-origin components imported into Europe reached $8 billion last year, nearly doubling compared to three years ago.
Referring to protectionist measures in the US, Bakai said that the European Union exports approximately $11 billion worth of components annually to the US, while tariffs are putting pressure on this flow. He also noted that high duties on steel-based components may push Chinese suppliers to seek alternative markets, which could further increase competitive pressure on Europe. In his presentation, geopolitical instability, protectionism, tariffs and energy costs were listed among the key risk areas facing the sector.
Short- and medium-term outlook for Europe
Bakai added that he does not expect a clear recovery for the European steel industry in the short and medium term. He stated that European light vehicle production is shrinking due to import pressure, while intense competition within China is creating increasingly strong competitors. He concluded that future decisions regarding industry and trade policies in Europe will be decisive for the sector’s trajectory.