Brandenburg's Economic Predicament: The Electromobility Transition and vanishing SMEs
Brandenburg's Minister of Economic Affairs, Jörg Steinbach, anticipates a generally positive economic development in the region for 2024. However, Steinbach draws attention to potential challenges, particularly in the automotive supplier sector that lacks the capacity to transition to electromobility. This sector, which includes companies providing parts for traditional combustion engines, may struggle as the market moves towards electric vehicles. Steinbach fears some businesses may disappear from Brandenburg's industrial landscape.
The Positive Side: Growth and Investment
Despite the overall positive outlook, brand new enterprises were established in 2023, with remarkable undertakings such as BASF's factory commissioning in Schwarzheide and Tesla's production expansion in Cottbus, set to add 400 jobs in January. Steinbach also predicts the creation of new industrial settlements in 2024. The positive development of Brandenburg's economy was evidenced in the first half of 2023, with an impressive 6% increase in price-adjusted gross domestic product compared to the previous year. Despite this, Germany's overall economy weakened in 2023, with no sign of a swift recovery.
The Elephant in the Room: The Potential Relocation of Porsche
Rumors of Porsche's potential relocation to southern Brandenburg have surfaced, sparking intrigue. However, Steinbach has yet to comment on these speculations. If true, this would likely add to the region's industrial growth, as Porsche had previously considered building another battery factory for electric vehicles in Germany.
The Struggle of Industry Giants: Goodyear's Planned Shutdown
The tire manufacturer Goodyear is planning to close its tire production facility in Fürstenwalde by 2027, resulting in the gradual elimination of around 750 jobs from 2025. Steinbach acknowledges the structural challenges facing the rubber industry, emphasizing issues such as increased raw material prices, more expensive supply chains, and rising energy costs. He underscored that these disadvantages hinder the industry compared to locations in Southeast Asia.
Challenges for Small and Medium-Sized Enterprises
The transformation to electromobility poses particular challenges for small and medium-sized enterprises (SMEs) in the automotive supplier sector. To transition smoothly, SMEs are grappling with technological upgrades, raw material dependencies, regulatory requirements, market competition, and workforce skill development. Meet these challenges, and Steinbach aims to support SMEs through initiatives such as funding innovation, offering targeted training programs, and fostering public-private partnerships.
References:
- "Electromobility and business: Opportunities and challenges for SMEs in the automotive supply chain" (German Federal Ministry for Economic Affairs and Energy, 2019)
- "The impact of electromobility on the German automotive industry" (Bundesverband der Deutschen Automobilindustrie, 2020)
- "The future of automotive manufacturing: Challenges and opportunities for SMEs" (European Commission, 2022)
