Vladimir Mitev, economic.bg/Economy magazine, 19 April 2026
Summary
The Romanian automotive sector is consolidating its position as a mainstay of the national economy, despite the major challenges facing the European industry. While Germany is undergoing a painful transformation, marked by factory closures and declining profits, Romania is managing to maintain stability thanks to a combination of its historic industrial tradition, massive foreign investment, and active state support.
Key economic indicators (end of 2025)
- Share of GDP: 13.2%.
- Exports: Generates 33% of the country’s total exports.
- Workforce: Over 220,000 employees in more than 630 companies.
- Revenue: 35 billion euros (of which 26 billion comes from parts production).
- Production: 545,000 vehicles, manufactured at the Dacia (Mioieni) and Ford (Craiova) plants.
The Role of State Aid and Investments
The sector is the main beneficiary of state funding. Between 2019 and 2023, over 300 million euros were allocated, and the trend continues into 2025:
- Draxlmaier: Receives €26.25 million to expand production of cables for electric vehicles.
- Dacia: Receives €7.36 million for technological modernization.
- Technological development: The Renault, Continental, Bosch, and Schaeffler centers no longer just assemble, but also develop systems for autonomous vehicles and active safety.
Challenges and Adaptation
Despite overall success, the sector is facing a “perfect storm”—the war in Ukraine, competition from China, and the crisis in the German auto industry (a 76% drop in profits in the third quarter of 2025).
- Labor market: A shift is underway—while the manufacturing sector is hiring, the software segment (companies such as ZF and Tata Technologies) is experiencing layoffs among engineers due to the suspension of global projects.
- New opportunities: The EU-Mercosur agreement (2026) opens new markets and ensures access to raw materials for batteries.
- Reskilling: The EC’s “Skills Guarantee” project (€14.5 million) helps workers adapt to digitalization and electric mobility.
Comparison with Bulgaria
The analysis highlights the contrast with Bulgaria, which remains primarily at the level of parts production.
The lack of a long-standing industrial tradition in the sector, weaker government support (unrealized projects for Great Wall and electric vehicles), and the absence of major scientific research facilities prevent the country from reaching the stage of full vehicle assembly.
Future Outlook
Romania’s future as the sixth-largest European manufacturer depends on its ability to attract battery production, develop chip design, and retain its software workforce. The sector has a strong multiplier effect (one job generates 5 to 7 additional jobs in other sectors), making it essential for the country’s social stability on the path to full electrification by 2035.
Article
In 2026, Romania’s automotive industry is undergoing a period of profound transformation, remaining a central pillar of the national economy, despite the fact that, starting in 2022, the combination of the war in Ukraine, technological changes, the success of electric vehicles in China, and the crisis in Germany’s automotive industry created what Adrian Sandu, secretary general of the Romanian Automobile Manufacturers Association, calls a “perfect storm.”
According to the latest ACAROM data summarizing the industry’s situation at the end of 2025, the Romanian automotive industry generates 13.2% of Romania’s GDP. Over 630 companies operate in this sector, providing jobs for more than 220,000 employees. The industry’s turnover has reached the 35 billion euro mark, with auto parts accounting for the largest share at 26 billion euros. This performance translates into a massive share of foreign trade, with the auto industry generating 33% of Romania’s total exports. In 2025, 545,000 cars rolled off the assembly lines in Mioveni (where Dacia cars are manufactured) and Craiova (where Ford cars are manufactured), a volume that confirms the country’s status as a major European manufacturing hub.
The success of this sector is no accident, but rather the result of a combination of local industrial tradition dating back to the socialist era, massive foreign investment, and government support, which, though sometimes criticized for bureaucracy, is generous when it comes to state aid.
An analysis conducted by EY Romania, published in December 2024, shows that the automotive industry was the main beneficiary of state aid between 2019 and 2023, receiving over 300 million euros. This trend continued in 2025, when the Ministry of Finance approved new strategic funding.
German manufacturer Draxlmaier received €26.25 million in aid to expand its production capacity for wiring harnesses for electric vehicles in Satu Mare, with a total investment of nearly €58.9 million, which will create 400 jobs. At the same time, Automobile Dacia received €7.36 million to modernize its painting process, strengthening its competitiveness through technological innovation. These investments are vital at a time when the industry is undergoing the greatest paradigm shift in its history: the transition to electric mobility and digitalization.
However, the international context is marked by severe turbulence, particularly in Germany, Romania’s main economic partner. According to data published by Ziarul Financiar and the DPA agency in December 2025, German automakers such as Volkswagen, BMW, and Mercedes-Benz faced their most difficult third quarter since the 2009 financial crisis. Their operating profits fell by nearly 76% amid massive investments in electric vehicles, which have not yet generated the expected returns, and declining demand in the Chinese market. This profitability crisis of “Europe’s locomotive” is sending shockwaves through Romania as well.
Adrian Sandu explains in an interview with the Bulgarian-Romanian website “The Bridge of Friendship” that the Romanian industry is inextricably linked to the European industry. Nevertheless, the secretary general of ACAROM emphasizes that Romania has demonstrated an excellent capacity to adapt. An indirect opportunity recently arose with the signing of the free trade agreement between the EU and Mercosur. As Adrian Sandu explained to the Romanian website Economedia in January 2026, this agreement allows for the reduction of export duties on European vehicles that include Romanian components and, above all, provides Europe with access to the minerals and materials needed for batteries at competitive prices, partially offsetting the closure of the Russian and Ukrainian markets.
The situation in the labor market is nuanced and reflects current technological challenges. While the traditional manufacturing sector continues to seek workers, offering wages above the national average, the automotive software segment is undergoing a period of readjustment. In October 2025, Economedia reported layoffs in Timișoara, where the German group ZF laid off approximately 170 engineers, and in Brașov, where Tata Technologies took similar measures. These adjustments are taking place against the backdrop of the suspension of certain global research and development projects. In this context, the European Commission’s initiative to launch the “Skills Guarantee”—a €14.5 million pilot project dedicated to retraining workers in the automotive sector—represents a necessary lifeline for Romania’s workforce as it transitions to new technologies. Roxana Mânzatu, Vice-President of the European Commission, emphasized that this system will help workers at risk of unemployment acquire the skills needed for the industries of the future.
A comparison with other European countries shows that the battle for competitiveness is a battle of subsidies. Spain, Europe’s second-largest automaker, has announced a massive plan for 2026, offering 1.3 billion euros to support electric vehicles and local battery production. The Spanish government aims for 95% of production to consist of electric cars by 2035—an ambitious goal that also puts pressure on authorities in Bucharest. In Romania, officials such as Deputy Prime Minister Tanczos Barna emphasized in November 2025 that certain tax measures, such as the minimum turnover tax (IMCA), act as a “brake” on investment. The Deputy Prime Minister insisted on halving this tax in 2026, arguing that the state has a duty to find policies that support the country’s largest exporter. At the same time, Mihai Bordeanu, head of the Dacia brand, called for predictability, particularly regarding energy prices—which have risen exponentially—and the continuation of the government’s “Rabla” program to replace old cars with new ones, considered the main “remedy” for renewing the vehicle fleet and supporting domestic sales.
From a technological standpoint, Romania is no longer just a low-cost assembly destination. Renault’s research centers in Titu, along with facilities operated by Continental, Bosch, and Schaeffler, are now developing and testing systems for autonomous and connected vehicles. A PwC analysis published by AGERPRES in February 2026 shows that Romania has climbed nine spots in the economic complexity ranking over the past decade, reaching 26th place globally. This progress is due to the ability to produce complex components, ranging from electronic braking systems to active safety technologies. However, moving to the next level—battery production or chip design—requires a coordinated national strategy and massive investments in dual education, which is a constant priority on ACAROM’s agenda. Adrian Sandu emphasizes that one job in the automotive industry generates another 5–7 jobs in related sectors, from metallurgy to logistics, highlighting its vital multiplier effect on social stability.
As of early 2026, Romania’s automotive industry remains a growth engine, but one that must be fueled by vision and fiscal stability. The resilience demonstrated in the face of successive crises—from the pandemic and the semiconductor crisis to the conflict in Ukraine—has proven the sector’s maturity. However, as 2035 approaches—when internal combustion engines were expected to become a thing of the past in the European Union (and there is currently discussion of a slight relaxation of the restrictions imposed on them, so that they can continue to exist as hybrids), Romania’s ability to attract battery production and retain software engineers will determine whether the country remains in 6th place in the ranking of European manufacturers or loses ground to global competition. With well-targeted government support and efficient use of European funds for retraining and innovation, the Romanian automotive industry has all the assets to remain the “pillar” of the national economy, transforming the challenges of eco-friendly mobility into a historic opportunity for development.
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