‘Electric Vehicles Could Cost 3 Million Auto Industry Jobs in Next 5 Years’

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Morgan Stanley’s Adam Jonas estimates the labour force reduction would cost automakers “collectively and over time upwards of” $60 billion

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With auto companies shifting production towards electric vehicles, the industry is going to see serious, widespread changes to its labour force in the coming years, a prominent analyst has said.

CNBC quoted Morgan Stanley’s Adam Jonas, who in a research note stated that the trend toward greater production and sales of electric vehicles could cost the auto industry 3 million jobs in the next three to five years.

Jonas estimates that the global auto supply chain employs “in the range of 11 million people.”

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30 per cent less labor needed to produce an electric vehicle

VW Group CEO Herbert Diess had said that it takes 30 per cent less labour to produce an electric vehicle than a similarly priced car that has the traditional internal combustion engine.

Highlighting this statement, Jonas said that electric vehicle production would result in a headcount cut of more than 3 million workers from the global auto industry. He fears that the number could increase.

As tech start-ups like Tesla and Rivian could build electric vehicles at “a 50 per cent reduction in direct labour … or more”, Jonas said this would reduce the global auto supply chain labor force even further.

Even at just a 30 per cent cut, Jonas estimates the labour force reduction would cost automakers “collectively and over time upwards of” $60 billion.

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