As the global Great Recession drags on, with European and North American auto markets languishing, the prospects for the Swedish car industry are challenging.
The industry could collapse before customers return in numbers sufficient for revival.
Swedish new car sales fell 17% in 2008, with a 35% downturn in the final quarter. The forecast for 2009 is for a further a reduction of 27% – about the same decline as in the U.S. market. According to the national Institute of Economic Research, unemployment is expected to rise from 6.1% to 7.9%.
As the Swedish government is no doubt by now painfully aware, about 700 companies in auto related areas support a workforce of close to 140,000 taxpaying job holders.
About 72,000 are employed in vehicle production and the component supply chain. Truck makers Volvo and Scania remain relatively strong in European commercial vehicle production, although they too are wracking up big losses in the Great Recession.