EV Popularity Leaves Workers and Parts Suppliers Shaking

Electric vehicles are supposed to be the wave of the future, but they also threaten to displace a major industry.

EV Popularity Leaves Workers and Parts Suppliers Shaking

Photo: Advertisement of Hyundai Ioniq 5.  Credit: Website of Hyundai Motors USA.

Electric vehicles are supposed to be the wave of the future: they are high tech, less polluting, and at this point nearly comparable to internal combustion engine cars in terms of price and driving distance. The popularity of the upcoming EV Hyundai Ioniq 5 is a testament to this trend: the crossover electric SUV set the new record for pre-orders in Korea in just one day.

But not everyone is happy with EV popularity. Compared to an internal combustion engine, an electric vehicle uses only half as many parts - which means fewer workers are necessary to assemble them. Hyundai Motors 현대자동차 already has been quietly reducing the size of its workforce by choosing not to replenish the ranks of the retired employees. Should EV become even more popular, a more dramatic cut may become necessary. The production line for Ioniq is causing tension between the company and its labor union, as the number of workers to be assigned to each production line is becoming a point of contention.

Auto parts companies are dreading the EV trend as well. Because of the fewer parts required to build an EV, up to 30% of  parts supply companies may be rendered obsolete. Fewer parts also means less occasions for maintenance or breakdown -  good news for consumers, but a disaster for auto shops that depend on repairing the transmission or changing the engine oil, neither of which exists in an EV.

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