Europe's car makers are in crisis. Will the threat of war rescue them?
Summary
European car makers face big problems as demand for regular cars goes down and competition from China grows. Some companies, like Ford and Renault, are turning to making military vehicles and equipment to use their factories more and benefit from Europe's increase in defense spending.Key Facts
- Ford’s Dagenham plant in the UK has cut engine production from 90,000 to about 45,000 a year over ten years.
- Ford is part of a joint effort to bid for a UK Ministry of Defence contract to supply 9,000 military vehicles to replace older Army Land Rovers.
- In the past, Ford’s Dagenham factory made military vehicles during World War Two, producing 360,000 vehicles for the Allies.
- European car companies face tough competition from Chinese car makers and see defense contracts as a way to survive.
- Renault has partnered with defense company Thales to mass-produce military drones for the French military.
- Volkswagen plans to convert an underused factory in Germany into a military manufacturing site with Israeli defense investors.
- Jaguar Land Rover is also bidding for the UK military vehicle contract and created a unit to focus on military markets.
- Industry experts say switching from car production to defense products can help use spare factory capacity.
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