According to foreign media reports, automotive parts supplier Freya is preparing to lay off about 13% of its European employees in the next five years and plans to use artificial intelligence technology to better compete with Asian competitors in the process of transitioning to electric vehicles. As of the end of last year, Freia employed approximately 75500 employees.

　　The CEO of this French company, Patrick Koller, stated on February 19th that the company's efforts to cut about 10000 jobs will include adjusting regional manufacturing and research and development spending. He said that this will increase the company's profit margin and keep pace with fundamental changes in the industry.

　　Image source: Freya

　　Currently, international component suppliers are facing increasing challenges in the Chinese electric vehicle market. After analysts questioned Freya's prospects in China, the company's stock price in Paris fell by 13%, and since the beginning of this year, the stock price has fallen by a cumulative 31%.

　　Bloomberg Intelligence analyst Gillian Davis stated in a report that the decline in Freya's stock price highlights the uncertainty of suppliers' prospects in China and their strong dependence on the Chinese market. Due to over 45% of Freia's pre tax profit coming from Asia, the integration of the Chinese electric vehicle market will have an impact on this French supplier.

　　Amidst reduced incentives and high car prices, car manufacturers and component suppliers are readjusting their electric vehicle strategies. Last week, German component manufacturer Continental finalized plans to lay off more than 7000 employees in its automotive division and pushed for the merger of factories in Germany and other regions to save costs.

　　In addition to reducing fixed costs, Freya also plans to use artificial intelligence to optimize development expenses. According to a statement, the company will rely on natural layoffs to reduce overcapacity in Europe and reduce its dependence on profits in the Chinese region.

　　Freia's goal is to save approximately 500 million euros ($539 million) annually by 2028, thereby increasing the profit margin from 2.5% last year to over 7%. Based on "basically stable" automobile production, Freia expects its sales to reach 28.5 billion euros in 2024, with an operating profit margin between 5.6% and 6.4%.