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Winterkorn: Europe Could Close 10 Auto Plants
Volkswagen CEO Martin Winterkorn says the European auto industry's current overcapacity equals the annual output of about 10 assembly plants.
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Volkswagen CEO Martin Winterkorn says the European auto industry's current overcapacity equals the annual output of about 10 assembly plants.
He points out that sales volume in the region is down from a peak in 2007 by at least 3 million units. Many analysts have said it could take a decade or more for sales to recover.
Winterkorn's assessment is mirrored by an analysis released during the Frankfurt auto show by Southfield, Mich.-based AlixPartners LLP, Automotive News Europe reports. The study estimates only 60% of auto plants in Europe will reach at least 70% of capacity the level needed to function profitably this year.
AlixPartners says the European auto industry must shed about 3 million units of capacity to achieve sustainability because sales are likely to remain flat. ANE notes that the industry is on track to close seven assembly plants between 2012 and 2014.
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