Speaking to Lusa news agency, José Couto the president of the Association of Suppliers of Automotive Industry (AFIA), said that the 358 companies in the sector, which directly employ 61,000 people, do not intend to make redundancies, given the specialisation and qualification of their workers.

“We could have a drop of 4,000 workers. We believe that companies will make an effort not to fire staff, but in the study we did this was the number they indicated to us”, said the association leader.

This data, revealed José Couto, is known to the Government, to whom AFIA is asking for measures to counteract the possible increase in unemployment, namely the reactivation of the simplified lay-off regime.

“In 2019, we had 62,000 workers, we dropped 2 percent in 2020, we went to 61,000. And, at this moment, our expectation is that the number of employed population will decrease. From 2019 to 2020, the country had instruments to contain unemployment and the simplified lay-off was a measure that proved to be effective. What we suggest to the Government is to reactivate this instrument, because if nothing is done, our members tell us that unemployment will increase”, he emphasised.

Perfect storm

At issue, in the automotive components sector, is the decrease in customer orders, namely from European manufacturers, with effects on the reduction of production, to which are added the costs of logistics with the "delay" of raw materials "in arriving from Asia to Europe”.

In terms of raw materials, there is also the scarcity of semiconductors on the market, "a very complicated problem and the expectation is that it will not be resolved in the coming years" explains José Couto.

Then there are energy costs “which have grown significantly”: “It's not just the price of fuel, the price of gas is also sky-high and the price of electricity is unaffordable. Companies suffer a lot, it's almost a perfect storm,” he added.

In the study that the AFIA prepared on the reality of the area of ​​automotive components and according to José Couto – who chairs the association created in 1966 on behalf of Microplásticos – “most companies say they will end up [in 2021] with fewer workers , which means a reduction in production capacity due to a reduction in fixed costs linked to employment”.

"At this moment, we have a set of information that says we can lose a lot of workers, because companies need to reduce their costs", he reaffirmed, noting that, "although they may have to free a number of workers", industrial units do not they want to do this, since “they are highly specialised workers and represent a huge cost for companies in the training and qualification process”.

“The automobile industry needs to maintain very high levels of productivity and companies are trying to keep these workers on their staff and not get rid of this very important asset”, he assured.

According to José Couto, in 2020, the sale of new cars in Europe dropped by 23.6 percent (4.4 million vehicles less) and in 2021, until August, 24.4 percent less were sold.