Michelin and Schaeffler announce significant job cuts due to competition issues, rising costs, and challenges in the European automobile market.

Concern in the European automobile market has been caused after Michelin and Schaeffler announced major cuts to their French facilities. The company announced it will shut two of its plants by 2026 and nearly 1,250 jobs in Cholet and Vannes will vanish. Stiffer competition from Asian tire manufacturers, higher energy costs and inflated prices in Europe were blamed for the closure. Michelin's global financial situation has also been negatively affected by concerns over new car sales, which have led to a more pronounced downturn.

The tire maker, which has around 19000 workers in France at present, will try to assist those employees to be affected by the closure using job placements with other companies, early retirement and or relocation within other plants of the company. All in the pipeline for 2025 are the closure of La-Roche-sur-Yon plant and two of Germany's plants, which also followed the 2020 closure of the plant in this French city.

German automobile parts manufacturer Schaeffler says it will lay off 4,700 jobs throughout 15 European sites, including 2,800 in Germany, and will close two facilities. The decision — which also influences its 120,000 global workforce — is made in the face of intense global competition and changes within the automobile supply chain.

It shows how European car manufacturers and suppliers are grappling with mounting costs, competition and market instability.