Christian von Albrichsfeld, Continental: The world and the global economy find themselves at the start of a new era

In an exclusive conversation, part of the “Industries to watch in 2024” cover story of the February edition of Business Review Magazine, Christian von Albrichsfeld, Country Head of Continental, offers an insightful view of the automotive industry’s trajectory in Romania for 2024. He delves into the nation’s potential bolstered by the National Recovery and Resilience Plan (PNRR) and how substantial European Union funds could spark significant growth across various sectors, including automotive.

Romania has a very big opportunity in front of it through the National Recovery and Resilience Plan (PNRR). The funds that the country can attract, and has already begun to do so, can lead to a considerable economic growth. Because it is connected to investments: in the automotive industry, in road infrastructure, in health system, in agriculture…

Now, through PNRR, we can develop microelectronics in Romania, respectively for semiconductor research and manufacturing. In total, there are hundreds of millions of euros that have already been won by companies, including Continental in Romania, and which will thus contribute to the progress of this field and of the economy itself.

The automotive sector is already strongly affected by the challenges brought by the technological transformation and the crises of the past years. These have led, globally, to a reduction in the number of new sold vehicles and to increased development costs for them. The automotive industry in Romania needs support and measures to facilitate the increase in sales in the automotive segment, as well as the reduction of research and production costs. Unfortunately, we are faced with an approach contrary to our needs, by adopting tax measures that were not discussed with the business environment (1% tax on turnover, reduced profitability even further on top of all challenges we already encounter, the reduction of the tax exemption for employees from one month to the next etc.).

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The suffocation with taxes and fees, in addition to the big challenges the overall economy is dealing with, reduces the competitiveness and foreign investments of the automotive sector in Romania compared to neighboring countries, at the level of the EU and at the worldwide level, both from the point of view of R&D and production activities. The automotive sector currently has a contribution of 13% in GDP and 29.5% in national exports.  

We need political stability and fiscal predictability. Romania is placed, by foreign rating agencies, in the “recommended for investments” area, so there is confidence in the potential that the country, as a whole, has.

The overall current situation is very challenging, both from a geopolitical and economical point of view. The wars, the global crises, and the overall uncertainty and unpredictability lead to the decrease of the purchasing power and to inflation, which have a negative impact. We hope and wish for stability, that will probably remedy the demand issue as well.

The world and the global economy find themselves at the start of a new era. The path toward transformation to a sustainable economy is clear. It is definetely an opportunity for the ones who are going to implement it well. It will represent an important competitive advantage. We take this path. While the solutions have not all been fully developed yet, we are establishing the framework for Continental and its partners. Sustainability has long been one of the key drivers of innovation at Continental, as part of its corporate strategy unveiled at the end of 2020, the company also plans to systematically seize the opportunities that arise as a result of the sustainability transformation. We are currently laying solid foundations for a sustainable future in the automotive industry. The four focus areas of sustainability at Continental are Carbon Neutrality, Emission-free Mobility and Industry, Circular Economy and Responsible Value Chains.