Investing.com -- Several car factories in Europe and North America are in danger of being closed or sold this year, according to a report by research and advisory firm Gartner (NYSE:IT).
The report, released on Thursday, suggests that automakers are grappling with issues of overcapacity and price competition.
The report forecasts that car manufacturers may reduce production capacity in Europe and North America in 2025 due to the challenges of meeting emissions targets and tariffs.
In contrast, China's dominance in the electric vehicle (EV) sector is expected to grow, given its advantages in software and electrification.
Gartner's VP Analyst Pedro Pacheco stated that closures or sales are more likely in high-cost countries. These regions would be under increased pressure due to competition, despite political and societal resistance.
Pacheco likened the situation to a pressure cooker, indicating that the increasing pressure would force automakers to make more practical decisions.
The report also predicts that Chinese brands could purchase existing plants to navigate trade barriers. Alternatively, they could establish new factories in lower-cost European countries or free-trade partners such as Morocco or Turkey.
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