Avramovic: It is not unrealistic that 10,000 people in the Serbian automotive industry will lose their jobs

In Serbia, there are more than 200 companies in the auto parts and components sector, employing around 100,000 people. The crisis that has hit German and other European manufacturers will reduce the number of employees in Serbia. At least 10% could lose their jobs. And exports will be particularly affected, says Nikola Avramovic, Senior Director with Alvarez and Marsal Financial Services in Austria and CEE, for Forbes Magazine.

Given the state of the electric car market, he believes that the opportunity for Kragujevac-based Stellantis lies in the possibility of producing hybrid models, for which the demand is growing.

– Component manufacturers make up the majority of the automotive industry in our country, and the automotive industry is one of the key sectors in our country, and Germany is the export market. We employ around 100,000 people. Expectations that around 10,000 people will be laid off, which is around 10%, do not sound unrealistic. This is something we can expect in the coming period, perhaps in the next year or two – says Avramovic.

Revenues in decline

According to him, Serbia is feeling the crisis in the German auto industry and most of these manufacturers here are large companies that work for the German auto industry, “so if they have a problem, we will too.”

– In the short term, all these companies in Serbia have been facing a decline in revenues in the last year, and these revenues come from exports to the European market. The coming year will also be challenging in the sense that the crisis has not yet spilled over to us from the European auto industry – believes Avramovic.

He also says that a decline in foreign direct investment from the auto sector is noticeable. This clearly indicates that there will be no expansion of plants and new capacities here. Avramovic adds that all this suggests that we can expect disruption in this sector on the domestic market, in the short term.

Plan should be prepared

– Serbia is no longer a destination for cheap labor, which is good on the one hand, but it also carries certain risks. Because, in the next five years, we can expect the departure of companies that base their business model on this. The risk is that entire cities and regions depend on these companies. So, we should see in time how and with what to substitute this loss – Avramovic assesses.

Alvarez and Marsal

Nikola Avramović

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