North Macedonia’s economy is facing increasing pressure as global changes in the automotive industry drive key manufacturers to reassess their operations. 

The EU candidate country had built up a thriving auto components industry, helped by its relatively low costs and proximity to major European carmakers. However, the European automotive sector has been grappling with declining sales and growing competition from China, leading to significant restructuring efforts.

Amid these challenges, major companies operating in North Macedonia are adjusting their strategies. Global automotive supplier Aptiv, which has operated a plant in the Bunardzik free industrial zone near Skopje since 2016, has announced plans to shut down its facility.

The company, employing around 500 workers, will relocate its production to Poland and Portugal as part of a broader effort to optimise its manufacturing capacity in response to market conditions.

According to 24.mk, US-based Dura Automotive has also decided to close its factory in North Macedonia. The plant ceased operations in February, laying off its workforce, with only a small number of administrative staff retained temporarily to finalise closure formalities.

Adding to the sector’s woes, British multinational Johnson Matthey, North Macedonia’s largest exporter, has announced job cuts due to ongoing difficulties in the global automotive market.

Viktor Mizo, head of the Council of Foreign Investors at the Chamber of Commerce, noted that the crisis in the automotive sector is affecting local businesses to varying degrees.

“The volume of work has declined, with some companies feeling the effects more than others. How they adapt will depend on their specific situation and the market segment they serve in Europe,” Mizo explained, according to plusinfo.mk.

He also highlighted key challenges, including the slow transition to electric vehicles, unstable tariff policies, and the high cost of cars – averaging over €40,000 in Europe – which are dampening consumer demand.

“Orders have decreased, adaptation to new requirements is slow, and competition from China is intensifying. These factors are creating strong headwinds for the industry,” he added.

The opposition Social Democrats (SDSM) have criticised the situation, calling it a clear sign of a poor business climate, inadequate economic policies and a lack of a coherent strategy.

However, Prime Minister Hristijan Mickoski defended the government’s approach, stating that officials had been aware of Aptiv’s decision for several weeks. He assured that new investment opportunities would help stabilise the economy.

“There are several new companies preparing to invest or open new production plants, so this is an ongoing process,” Mickoski said in response to concerns over Aptiv’s departure.