The Transition to Electric Vehicles in CEE

A new FES paper examines the implications of the transition to electric vehicles for the CEE region. Central Eastern Europe, together with Romania, has become a centre of car assembly in recent decades: Approximately one third of all passenger cars produced in Europe are manufactured here. The upcoming transition to electric drives - from 2035 onwards combustion engines may no longer be sold in the EU - will strongly affect the region. Especially since employment in Central Eastern Europe is particularly high in those areas of the production process that will be most affected by the transition to e-mobility: The construction of combustion engines, transmissions and powertrains.

According to the argumentation of the FES paper, the effects will primarily affect the type of work performed and the production processes used. However, the production sites in CEE themselves and employment there do not appear to be directly threatened. The assembly of e-cars ultimately requires a similar overall volume of work as the assembly of internal combustion vehicles.

A prerequisite for such a development, however, is that the CEE countries succeed in locating battery cell production in the region to a sufficient extent. This in turn requires a stable supply of affordable energy, as battery cell production is an energy-intensive process. The war in Ukraine and its consequences on energy supplies in Central Europe will create a challenge in this respect.

The signs that this transition could succeed are rather positive at the moment. This is indicated both by various investment decisions of German car companies such as BMW and Mercedes, but also by the growing involvement of large battery cell manufacturers such as CATL or Samsung in the Central Eastern European region. Hungary and Poland are now among the major battery producing countries in Europe.