Notes fromthedesk.

I have spent much of my career working at the intersection of automotive manufacturing, industrial transformation and new technology. I have seen the industry evolve, adapt and reinvent itself. I have also seen how difficult it is to transform an industrial ecosystem when the economic and political conditions are working against it.

Europe's automotive sector is not simply a collection of car manufacturers. It is an industrial ecosystem supporting approximately 13 million jobs across the European Union, including vehicle production, components, materials, logistics, engineering, research and a wide range of associated services.

Behind that number are families, local communities, technical skills and entire regional economies built around manufacturing.

This is what makes the current situation so dangerous.

The transformation of the automotive industry is one of the most significant industrial shifts in generations. Vehicle architecture is changing. Supply chains are being restructured. Software, batteries, power electronics and new manufacturing technologies are becoming increasingly important. Established business models are being challenged, and manufacturers must invest enormous sums simply to remain competitive.

Such a transformation inevitably creates winners and losers. But the outcome is not predetermined.

Europe could use this moment to strengthen its industrial position: develop competitive battery production, secure access to critical materials, build advanced electronics capabilities and create the next generation of manufacturing technologies.

Instead, the continent risks losing established capabilities before new ones have reached sufficient scale to replace them.

If manufacturers continue to restructure, suppliers fail and production moves to more competitive regions, millions of jobs could be affected over the coming years. The precise scale is uncertain, but the risk is serious and should not be underestimated.

When a factory closes, the damage extends far beyond its gates. Suppliers lose contracts. Skilled workers leave. Technical knowledge disappears. Local businesses lose customers. Investment follows new opportunities elsewhere.

Once an industrial ecosystem has been dismantled, rebuilding it can be extraordinarily difficult and expensive.

The automotive industry may be the first major warning. Europe should not assume it will be the last.

Regulation has a legitimate role in a functioning economy. The problem begins when the cumulative burden of rules, administrative procedures and reporting requirements becomes so complex that it undermines the very businesses expected to generate investment, innovation and employment.

Europe has developed a political culture in which announcing new requirements can be mistaken for delivering results.

A target is not a factory. A directive is not a supply chain. A subsidy announcement is not a commercially sustainable business. And a strategy document cannot manufacture competitiveness by itself.

Industrial investment requires confidence. Companies need predictable rules, reliable infrastructure, competitively priced energy and the ability to obtain permits within commercially realistic timeframes.

Instead, businesses can find themselves navigating overlapping requirements, uncertain interpretations and lengthy approval processes. Management teams spend time dealing with administration that could otherwise be devoted to developing products, improving production and creating jobs.

For large corporations, these costs can be absorbed to a degree. For smaller manufacturers and suppliers, they can become decisive. A company operating on tight margins cannot endlessly absorb additional costs without consequences.

Investors have choices. They can build in Europe, the United States, the Middle East or Asia. They compare the total cost of doing business, access to capital, energy prices, infrastructure, labour, market opportunities and political risk.

Capital does not have a moral obligation to remain in Europe.

If another jurisdiction offers a more attractive environment for industrial investment, companies will respond accordingly. They may not announce that they are leaving because of bureaucracy. They may simply decide that their next factory belongs somewhere else.

This is how deindustrialisation often happens: not in one dramatic moment, but through thousands of individual investment decisions that gradually move jobs, technology and economic power beyond the continent's borders.

Europe's industrial problem is not a shortage of political declarations, strategic frameworks or ambitious targets. It is the growing disconnect between political decision-making and the economic realities of building and operating industrial businesses.

Factories require competitive energy, capital, skilled workers, infrastructure and predictable rules. They require decisions to be made in months rather than years. They require governments and institutions that understand the difference between announcing an industrial strategy and making industrial investment commercially viable.

When these conditions deteriorate, businesses adapt. They postpone investment, reduce capacity or build their next facilities elsewhere. Eventually, production moves, suppliers disappear and skilled workers leave.

This is not an ideological argument. It is the economic reality of international competition.

Europe cannot preserve its prosperity by making it progressively more difficult to manufacture, innovate and invest within its own borders. Nor can it assume that the industries it loses will automatically be replaced by new ones.

Industrial capacity is built over decades. It can be lost far more quickly.

The question Europe must answer is simple: does it want to remain a place where the world's most advanced products are designed, engineered and manufactured, or is it prepared to become increasingly dependent on other regions for the technologies and products on which its prosperity depends?

While Europe debates, other regions are pursuing industrial strategies with considerable determination.

The United States has used investment incentives, energy resources and the scale of its domestic market to attract manufacturing. Asian economies have built formidable positions in batteries, electronics, materials and advanced production. Gulf economies are seeking to diversify their economies by investing in infrastructure, technology and new industrial capabilities.

Each region has its own challenges. None has a guaranteed future. But they understand that industrial capacity matters.

Europe still possesses enormous strengths: world-class engineering, leading universities, established manufacturers, sophisticated infrastructure and a highly skilled workforce. These are significant advantages. They are the foundations from which a recovery could be built.

But historical strength does not guarantee future success.

A company that fails to adapt loses its market. An industry that loses its supply chain loses part of its independence. A continent that makes it increasingly difficult to manufacture, invest and innovate should not be surprised when economic activity moves elsewhere.

Europe must compete for its own industrial future. It cannot assume that the companies and technologies that made it prosperous will remain simply because they were once European.

The European Union was built around cooperation, economic integration and the promise of shared prosperity. Its long-term legitimacy depends, in part, on its ability to deliver those outcomes.

If industrial decline accelerates, the consequences will extend far beyond employment and corporate earnings.

Tax revenues will come under pressure. Regional inequalities may deepen. Public spending commitments will become harder to sustain. Economic opportunities may narrow for younger generations. Political frustration will grow, particularly in communities that feel they are paying the price for decisions made far from their workplaces.

That creates a serious challenge for the European project itself.

I believe Europe risks entering a period of profound economic and political instability if it fails to change course. The EU, in its current form, cannot assume that it will survive indefinitely without addressing the concerns of its industrial base and the people who depend on it.

That is a warning, not a claim that the Union's collapse is inevitable.

Europe still has the resources, institutions and industrial knowledge needed to respond. But the longer meaningful reform is delayed, the more difficult and expensive recovery may become.

Political institutions ultimately depend on public confidence. If people increasingly associate the European project with lost jobs, declining investment and reduced economic security, that confidence will inevitably be tested.

An economic model that fails to deliver prosperity will eventually face a political reckoning.

Europe needs a new industrial compact—one built around competitiveness, execution and economic reality.

First, simplify regulation. Review the cumulative burden of existing and proposed rules, eliminate unnecessary duplication and make compliance more proportionate. Businesses need clear, predictable requirements rather than a constantly expanding administrative workload.

Second, restore competitive conditions for energy-intensive industry. Reliable and competitively priced energy is a prerequisite for manufacturing. Without it, Europe will struggle to retain industries that compete against producers operating under more favourable cost conditions.

Third, accelerate permitting and infrastructure delivery. Industrial projects cannot compete internationally if approval processes take years while other jurisdictions move ahead. Decisions must be timely, infrastructure must be available and responsibility for delivery must be clear.

Fourth, put manufacturing at the centre of economic policy. Europe must strengthen its capabilities in batteries, energy storage, power systems, automation, advanced materials and artificial intelligence. It needs to create an environment in which these technologies can be developed, financed and manufactured competitively.

Fifth, reconnect policy with industrial reality. Major policy decisions must be assessed against their practical consequences for investment, employment, productivity and strategic independence. Good intentions are not enough. Outcomes matter.

Finally, restore respect for entrepreneurship and industrial competence. The people who invest capital, develop technology, employ workers and take commercial risks are essential to Europe's future. They should be treated as partners in economic development, not as an endless source of compliance obligations.

These are not radical demands. They are the basic conditions required for a functioning industrial economy.

I have spent decades working on industrial projects across different markets. One lesson is consistent: industrial development requires more than a compelling vision. It requires capital, infrastructure, engineering, execution and a business environment in which companies can compete.

The same principle applies to nations.

Europe can remain a global industrial power, but not by relying on its past. It must become more competitive, more pragmatic and more capable of turning ambition into production.

The alternative is a gradual erosion of industrial capacity, followed by a much harder struggle to recover it. The automotive industry may be the first major warning, but other sectors could follow if the underlying problems remain unresolved.

The stakes are measured not only in factories and jobs, but in economic independence, technological capability and the standard of living of future generations.

Europe does not need another decade of declarations. It needs action. It needs leaders who understand that prosperity must be created, that manufacturing cannot be taken for granted, and that industrial capability is a strategic asset.

Europe still has time to change course. But time is not an industrial strategy, and delay is not a substitute for reform.

The cost of waiting may be far greater than the cost of changing direction now.