Volvo CEO: European car industry could collapse

Volvo CEO Håkan Samuelsson in an interview with the German newspaper Handelsblatt said that the European automotive industry may face a crisis according to the scenario of the American Detroit.

The reason he called the transfer of production and the reduction of jobs.

The situation in Europe is strikingly similar to what happened in the United States. In Detroit, manufacturers made a lot of money, but then the industry moved south.

Samuelsson noted that the arguments for such a shift are remarkably similar to those made today by some European manufacturers: low energy costs, taxes and fees, and lower hourly costs are almost half as much.

The head of Volvo urged to see what it turned out for Detroit. After the oil crisis and the relocation of production to the south, the city lost its economic base, and the population began to leave.

In 2013, Detroit declared bankruptcy, with many neighborhoods empty and infrastructure in decline. Samuelsson made it clear that Europe risks going down the same path unless it changes its approach to preserving industrial production.

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