Impact of automatisation on the European automotive industry

Abstract

The purpose of this report is to provide an analysis of advanced automation within the European automotive industry, examining its impact on manufacturing strategies, employment restructuring, and the socio-economic stability of local supply chain ecosystems. Driven by the shift toward Industry 4.0 and the transition to electric vehicles (EVs), the research investigates how companies balance technological innovation with economic viability, workforce sustainability, and regional industrial resilience. The study employs a qualitative methodology, combining an extensive review of literature, documents, and data with a semi-structured interview and case study of Seat’s Martorell plant in Spain. Key findings indicate that while advanced automation significantly enhances operational efficiency and ensures compliance with strict EU environmental legislation, it simultaneously introduces a digital vulnerability premium, where the connectivity required for green compliance expands the industrial cyber-attack surface. With regards to labor and industrial organization, the report concludes that automation has triggered a restructuring rather than a mass-death of jobs. Internally, resulting in job polarization where demand for high-skill analytical roles increase while routine manual tasks decline. Externally, the research identifies a structural divergence on supply chain: while digital service providers experience rapid growth, traditional local mechanical supply chains face organic decline. This trend creates a risk for established Western European hubs, where the contraction of the mechanical industrial base threatens the broader regional economy through negative economic multiplier effects. A regional difference is also identified, where Eastern Europe is emerging as a high-growth hub for automated EV projects, while Western Europe face stagnation and the high costs of upgrading its obsolete facilities. Furthermore, implementational challenges are highlighted, specifically the skill bottleneck created when technological adoption outpaces human adaptability, and the rising cyber risk exposure that comes with increasingly digitalized production systems. The research suggests that the success of this industrial transformation depends less on technological breakthroughs and more on the ability of manufacturers to transition from reactive to proactive reskilling strategies to keep pace with rapid technological advancements.

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