Romania’s National Bank (BNR) signals that the production in the country’s automotive sector will decelerate in 2019 for the first time in the past 19 years.

BNR points to Germany’s industry as the main source of risks for this sector and recommends better infrastructure and investments in the research and development so that Romania’s automotive industry remains competitive, Economica.net reported.

The slowdown will be particularly visible in the car parts production segment, the central bank warns. Its studies show that the production growth in the local automotive industry eased to 1.6% year-on-year, in the first eight months of this year, compared to an average annual growth rate of 12.5% over the past ten years.

Both external and internal factors have led to this evolution, the central bank argues. The fragility of the auto segment in the last period is not specific only to the Romanian economy, being a “worldwide phenomenon in a general context dominated by the effects of the economic conflict between the US and China," reads the BNR report. Brexit will also have an impact in the domestic and international auto sector.

Another key element is the fundamental change in the manufacturing process of motor vehicles, in the sense of the global orientation towards electric vehicles.

editor@romania-insider.com

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