The newest Ford Mustang made a splash when it was unveiled this weekend. An all-electric SUV, the vehicle has enough room for a cooler under its hood and can reportedly accelerate from zero to 60 in well under four seconds.
Electric cars represent a significant step toward reducing reliance on fossil fuels and carbon emissions that scientists say are beginning to wreak serious havoc on the world.
About 1 million workers are employed in auto manufacturing, primarily for vehicles with internal combustion engines, out of about 12.8 million manufacturing jobs. But analysts note that electric vehicles require significantly less labor, raising questions about how the coming shift could slim down such a critical part of the U.S. economy.
Electric vehicles raise a whole host of questions for autoworkers. The vehicles’ simplicity means they require significantly less manpower to make and assemble: the Chevy Bolt, for example, had 80 percent fewer moving parts than comparable fuel engines, UBS analysts have found. Their production is more simple and straightforward. And the parts they do use are now often made overseas.
“It could be that the cars become so modular and the assembly process becomes so straightforward [that] you picture them like Legos — you kind of bolt them together. You could need even less skill to put those cars together,” said Karl Brauer, an auto industry analyst who is the executive publisher of Autotrader and Kelley Blue Book.
Auto executives have not been shy about these changes.
Ford executives told investors that electric vehicles could reduce the company’s work hours per car by 30 percent, and its capital investment by 50 percent. Volkswagen Group CEO Herbert Diess said that the switch “means we will need to make job cuts.”
“Achieving this purely through fluctuation and partial retirement will be difficult,” he said.
About 95 percent of cars in North America still use internal combustion engines, but that number is expected to decrease sharply in coming decades. By 2030, those cars could make up just over 50 percent of the market, with hybrids joining electric battery and fuel cell powered vehicles to make up the rest, according to a forecast made by the Center for Automotive Research in an upcoming report. By 2040, the number of cars powered by internal combustion engines could fall to 30 percent, the center estimates.
Electric vehicles only make up about 2 percent of the market globally. But it is a growing niche. Tesla, the leading manufacturer of electric cars, sold 360,000 cars this year so far.
“Electrification is really starting to take hold,” said Kristin Dziczek, a vice president at the Center for Automotive Research. “That does have huge implications.”
Compounding the issue from a jobs perspective is that many electric car batteries are produced by companies in Europe and Asia. The electric Mustangs will be assembled in Mexico using a battery pack that will be made in Poland.
While European governments have spent time and money exploring how to grow supply chains for electric vehicle components, the United States auto market continues to revolve around internal combustion engines.
Even acknowledging the existence of climate change remains a political sensitivity in conservative quarters. Ford’s marketing materials for the Mustang highlighted its power and acceleration, and not its sustainability, for example.
Michelle Hill, a vice president at management consulting firm Oliver Wyman, pointed to data that her firm had crunched that showed that for each percentage point increase in the electric vehicle share of the market equated to 185,000 fewer engines and transmissions. At a projected 15 to 25 percent of the market share, electric vehicles could mean a decrease of 18,000 to 29,000 manufacturing jobs.
Then there is the question about the quality of jobs in electric auto manufacturing.
Unions have helped ensure that American auto company plants are home to stable middle-class jobs, many of them in economically challenged areas across the Midwest. But technology companies and start-ups that make electric batteries don’t bring that same history.
“If these new employers have a poor history of manufacturing labor relations, or if they treat EV components as low-value commodity products, it could result in more production under low-road conditions, undermining job quality in the auto sector,” the United Auto Workers noted in a report about electric vehicles earlier this year.
GM sold a shuttered plant in Lordstown, Ohio, to an electric pickup truck start-up earlier this month — the conclusion of a discussion that had animated negotiations during the recent UAW strike that halted production at General Motors for nearly six weeks.
At that facility, workers hired — or rehired — will make about $17 an hour, according to media reports, significantly below the approximately $30 an hour earned by many General Motors workers.
The company also agreed to keep open another General Motors plant that had been slated for closure next year to produce electric cars, Hamtramck.
Chris Viola, an assembly worker there, said that a substantial number workers had left for work elsewhere because of the planned closure, but said that those still working there were grateful that they’ll be able to keep their jobs.
“Most people are just happy that we have product coming in,” he said. “I hope it’s a moneymaker and not just something we try and doesn’t pan out.”
At Tesla, where workers have said they make between $17 and $21 an hour, the company has had a tense relationship with its workers’ efforts to unionize.
In September, a judge charged the company and CEO Elon Musk with violations of federal labor law over efforts to discourage union activity at the company. Questions remain about the pace of assembly and safety of the company’s operation.
Because of this, United Auto Workers has been urging policymakers and other stakeholders to get more involved in planning for electric vehicle technology.
Rohan G. Williamson, professor of finance at Georgetown University, said that major automakers will have to reinvent themselves and their workforces.
“You’re going to need a more technologically advanced workforce,” Williamson said. “If you kind of picture the traditional car assembly plant, it’s going to be much more about programming a machine to do a lot of that work.”
As a result, he said, major automakers will have fewer and fewer jobs that can be performed without at least some training past high school.
Meanwhile, he said, vehicle assembly will become more highly skilled work, drawing a workforce that wasn’t brought up in the traditional union environment.
“There will be a challenge because the view of the labor assembly plant worker is going to be more of a skilled computer guy,” he said. “I think there will be some challenge to labor unions in an environment where you have electric cars that are assembled more by computer programmers.”