Electromobility Throws Poland’s Automotive Sector into Turmoil

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Most car manufacturers declare that they will be ready by 2035 for the obligation to introduce only zero-emission vehicles into circulation. However, the problem will lie with the manufacturers of parts and components, as most suppliers for car factories operating in Poland produce components exclusively for combustion cars. Many of them are not yet prepared to change their production profile for electric cars. This also applies to mechanical workshops, which are currently primarily focused on conventional motoring. Importers and distributors of spare parts must also prepare for these changes. “If we do not move forward, we will only have functions left, most of us in this market will not survive,” says Michał Tochowicz, CEO of Moto-Profil.

“The move away from combustion engines means that we, as parts distributors, need to change our strategy. We need to consider a new range. From what we hear, electric cars have about 25% of the parts that conventional cars currently have, so this is a huge change. Therefore, we need to some extent scale down our operations and think about how we can still make money from this “, says Michał Tochowicz to the Newseria Biznes agency.

According to EU regulations, from 2035, a 100% reduction in emissions from newly sold cars will apply throughout the European Union, which means that manufacturers will only be able to introduce new emission-free vehicles to the EU market – mainly electric or hydrogen, but also synthetic fuels.

The automotive industry has been preparing for the introduction of these regulations for a long time – most manufacturers already have a substantial portfolio of zero-emission vehicles, and many brands have announced their departure from combustion drives even earlier than the EU deadline. However, the problem will be the manufacturers of parts and components, as most companies operating in Poland, which are suppliers to car factories, produce components exclusively for combustion cars. This also necessitates training in the operation of electric cars.

“If we do not move forward, we will only have functions left, most of us in this market will not survive, which means changing brake pads or oil. On the other hand, this change is also a great opportunity to do business. Investments in workshop equipment, diagnostics, training will certainly be needed,” says the CEO of Moto-Profil, a distributor of automotive parts and accessories, a supplier to wholesalers, shops and car workshops.

According to this year’s Exact Systems survey (“Motobarometer 2023”) in Poland, 55% of automotive plant representatives believe that in 2033-2034 electric cars (excluding hybrids and plug-in hybrids) will already account for at least half of the total sales of new cars. A gradual departure from combustion engines seems inevitable, although many industry representatives still doubt that this will happen as early as 2035. Especially considering the fact that in Poland in the first half of this year, BEVs accounted for only 3.6% of all newly registered cars.

“There are many concerns about what will happen next, because we still do not know the detailed regulations. We keep getting some information, but it is not fully certain,” says Michał Tochowicz. “We absolutely need support, and we are talking about both legislation in Poland and European legislation. We also need people who understand motoring and this business, not only from the manufacturer’s perspective but also the aftermarket. COVID-19, which slowed down car production, clearly showed that we – as the aftermarket – are very important in maintaining mobility. It made this market a star for a moment, allowing manufacturers to stay afloat to some extent. Unfortunately, this is now forgotten, so we need support. We realize that we are at a critical moment, but we currently need this support very much and I think that if we get it, we will use it brilliantly, providing work for a large number of people and paying high taxes.”

According to the Association of Automotive Parts Distributors and Manufacturers in Poland, the automotive industry accounts for 8% of GDP and about 13.5% of export value. The driving force of this industry are the parts suppliers. Poland – called the basin of automotive parts production – ranks seventh in the list of the largest component exporters in the world, with an export value of about 15.1 billion dollars, which is growing year by year. Major global corporations such as Bosch, Brembo, BorgWarner, Federal-Mogul, Gates, Mahle, DRiV, ZF-TRW, and Valeo have their parts factories in Poland, but there are also many native businesses that operate vigorously on the domestic and foreign market.

Poland has the ambition and potential to become one of the leaders in electromobility in Europe from the supply side, i.e. the production of electric vehicles and their parts and components. According to the Polish Chamber of Business Development, our country already accounts for about 30% of European production of components for electric vehicles, and under Wroclaw operates the largest battery factory for cars in Europe, LG Energy Solution.

“We are always thinking about the future. Our flagship idea is our training program for students, which allows young adepts in technical schools or vocational schools to repair cars in virtual reality. This is a really big thing, we have been running this project for over two and a half years and we have invited recognized industry suppliers to it. We are also talking about introducing it into didactics in schools,” says the Moto-Profil CEO.

According to ACEA data, in the European market in the first half of this year, the share of electric cars in total new passenger car sales amounted to 12.9% (compared to 9.9% a year ago). This most often happens at the expense of diesels, whose share dropped from 17.4 to 14.5% within a year. The most electric cars are registered in the northern and Scandinavian countries (Norway, Iceland, Sweden, followed by Germany and France). In Poland, the share of electric cars still does not exceed 10% (at the end of October this year, there were a total of 52.3 thousand passenger and commercial fully electric cars driving on Polish roads). The problem is still their prices, which discourage potential buyers. According to IBRM Samar, the weighted average price of a passenger car registered in June 2023 amounted to nearly PLN 176 thousand. However, in the case of electric cars, this price was much higher and amounted to nearly PLN 270 thousand. The second barrier to the proliferation of electric cars is the lack of sufficient charging infrastructure. According to “Electromobility Counter” PSPA and PZPM at the end of October this year, in Poland there were 3166 public charging stations for electric vehicles (6378 pts), of which 1/3 were fast charging stations with direct current. ACEA also points out that – considering the number of chargers in the EU – a huge gap can be seen between the countries at the top and the bottom of the ranking. Half of all EU charging points are located in the Netherlands (90 thousand) and Germany (59 thousand). Poland ranks 12th, in the middle of the pack, with a 0.9% share of the total number of chargers in the EU.