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Audi Brussels Plant Faces Potential Closure Amid Declining Orders: Over 3,000 Jobs at Risk

Brussels, July 10, 2024 — German carmaker Audi has announced a major restructuring of its Brussels production site, a move that could potentially lead to the complete closure of operations and jeopardize over 3,000 Belgian jobs.

The announcement was made on Tuesday evening during an exceptional works council meeting following a crisis meeting at Audi’s headquarters in Ingolstadt, Bavaria, where production figures for the first half of 2024 were finalized.

The Brussels Forest site, the only Audi production line in Belgium, has been manufacturing the company’s flagship electric SUV modelsthe Audi Q8 e-tron and the Audi Q8 Sportback e-tronsince 2022.

However, the site now faces an uncertain future due to what Audi describes as a “global decline in customer orders in the electric luxury class segment,” significantly impacting the e-tron models.

Declining Orders and Structural Challenges

In a statement released on Tuesday, Audi confirmed it is considering ending production at the Brussels plant. The company cited a “sharp drop” in incoming orders for the Q8 e-tron, attributing this decline to increased competition from other luxury electric vehicles.

While the Q8 e-tron has enjoyed success for several years, the current market dynamics have led to a significant reduction in demand.

Audi also pointed out “long-standing structural challenges” at the Brussels site. The plant’s proximity to the city center complicates any potential changes to the layout, and high logistical costs further strain operations.

After an “intense review of the market situation and the general conditions at the Brussels site,” Audi is contemplating halting production of the Q8 e-tron model series, possibly moving production to its Mexico plant.

Potential Impact on Workers

The announcement has understandably caused significant concern among the workforce at the Brussels site. The plant, which produced its first car in 1949 for the Studebaker brand, now employs more than 3,000 people.

Belgian newspaper L’Echo reports that between July and October, almost half of this workforce (1,410 employees) could lose their jobs due to the sharp fall in production figures for the Q8 e-tron.

Management at Audi Brussels plans to restructure the site by triggering the “Renualt procedure” – a mandatory consultation period with workers under Belgian law, established following the closure of a Renault factory in 1997.

While discussions with unions will explore potential solutions, the company has warned that a complete cessation of operations in Brussels is a possible outcome.

Government and Union Reactions

The news has prompted reactions from various stakeholders, including government officials and union representatives. Belgian Minister for Economy and Labour, Pierre-Yves Dermagne (PS), expressed his regret over the restructuring plans announced by Audi Brussels.

As Deputy Prime Minister, he assured that staff at the plant would be kept informed throughout the process and that all possible measures to preserve jobs would be seriously considered.

Last June, Prime Minister Alexander De Croo (Open VLD) and Finance Minister Vincent Van Peteghem (CD&V) had already taken steps to try to save the Brussels site.

They wrote to the board of Audi Brussels in an attempt to convince the car manufacturer to maintain its operations in Belgium, underscoring the importance of the plant for the local economy and workforce.

Union representatives have also voiced their concerns. They fear the worst, particularly since Audi has seemingly ruled out the possibility of building a replacement model at the Forest site.

With the production target for 2024 set at 20,000 to 25,000 cars – less than 50% of the 53,555 vehicles produced last year – the outlook is grim.

For comparison, 230,000 electric vehicles are produced annually at Volvo’s plant in Ghent, and over 400,000 cars are manufactured at Audi’s Ingolstadt plant.

Future Prospects and Industry Impact

The potential closure of the Brussels site would mark a significant blow to Belgium’s automotive industry. The plant has a long history, celebrating the production of its 8 millionth car in November 2021.

Throughout its operation, the site has produced various brands, adapting to changing market demands and technological advancements.

In his press release, CEO of Audi Brussels Volker Germann emphasized that no final decision has been made yet. He stated that “a transparent and constructive dialogue is important in the process that will follow. We will take all perspectives into account.”

This statement leaves some room for hope that a solution might be found to preserve at least some of the jobs and operations at the site.

The restructuring at Audi Brussels is part of a broader trend in the automotive industry, where companies are grappling with the transition to electric vehicles and changing consumer preferences.

The shift towards electric mobility presents both opportunities and challenges, with manufacturers needing to balance innovation, cost management, and market competitiveness.

Conclusion

As Audi Brussels faces potential closure, the impact on the local workforce and the broader Belgian economy cannot be overstated. Over 3,000 jobs are at risk, and the future of the site remains uncertain.

While government officials and union representatives are working to find solutions, the challenges are significant.

The automotive industry continues to evolve rapidly, and companies like Audi must navigate these changes carefully to remain competitive and sustainable.

The coming weeks and months will be crucial in determining the fate of the Brussels plant. For now, the employees, their families, and the broader community are left in a state of anxious anticipation, hoping for a resolution that will safeguard their livelihoods and the legacy of a historic production site.

 

This article was created using automation technology and was thoroughly edited and fact-checked by one of our editorial staff members

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