Metalworking, electronics in most vehicle components made in Portugal

The metallurgical/metalo-mechanical and electrical/electronic areas represent 63% of the components for cars produced in Portugal, in 385 factories belonging to 358 companies, mostly located (85%) in the North and Centre regions, an association of the sector said on Monday.

According to information provided to Lusa by the Automotive Industry Suppliers Association (AFIA), metallurgy and metalworking account for almost a third (32%) of the components manufactured in Portugal, followed by the electrical and electronics industries (31%), plastics, rubber and other composite materials (18%), textiles and coatings (11%) and systems assembly (5%).

According to the same data, the 358 companies in Portugal – 63% with a majority of the Portuguese capital and 37% with foreign capital in the majority – are located in the North Region (55%), followed by the Centre Region, with around 30%. The Lisbon and Tagus Valley region brings together around 8% of the sector’s industries and the Alentejo 6%.

Between 2015 and 2019, the average annual growth rate of turnover stood at 8.8%, reaching €11.9 billion in turnover in 2019, before the Covid-19 pandemic.

In 2020, turnover was €10.4 billion (about 5.6% of the national gross domestic product), down 12.6% on the previous year.

The 358 companies are 0.9% of the total manufacturing industry, in which they represent 8.8% of jobs. Between 2015 and 2019, more than 14,000 jobs were created in the automotive components sector, an ever-increasing trend that contributed to an average annual employment growth rate of 6.6% in that period.

From 2019 to 2020, in the middle of the Covid-19 pandemic, employment fell by 2% (about a thousand jobs), currently standing at 61,000 people (58% men and 42% women, a proportion that, according to AFIA, has been constant).

In 2021, given the reduction in orders from the automotive sector and, among other things, the need for companies to lower their fixed costs, the association warned that another 4,000 jobs could be lost, which would mean returning to mid-2017 levels.

Last year, exports stood at €8.6 billion (82% of total production and 16.1% of foreign sales of tradable goods), mostly to Europe, the continent that absorbed more than 90% of exported components. The main destination market was Spain (30%), followed by Germany (21.2%) and France (11.8%).

Over the same five-year period, from 2015 to 2019, AFIA indicates that the average annual growth rate in exports stood at 7.3%. The total volume of exports fell, however, by 10.8% in 2020 compared to 2019, from €9.7 billion to €8.6 billion.

“We have great relevance in exports. If we cannot find instruments to help these companies, our export account will probably fall, because these companies, losing competitiveness, are no longer in the European business game,” said José Couto.