Strategic Foresight in the European Automotive Industry
The European automotive industry is undergoing a systemic transformation driven by electrification, digitalisation, evolving regulatory frameworks, and increasing geopolitical uncertainty. This transition is not limited to a change in propulsion technologies: it is reshaping industrial value chains, competitive dynamics, supply dependencies, and the role of software and data in mobility systems.
This IIF Policy Paper argues that traditional forecasting approaches, while still useful, are not sufficient to address the complexity of the current transition. In a context characterised by technological discontinuities, volatile demand, supply chain risks, and policy-driven change, strategic foresight offers a more suitable framework for supporting decision-making. Rather than predicting a single future, it enables policymakers and industry actors to explore multiple plausible futures and assess which strategies remain robust under different conditions.
Using a scenario-based foresight approach, the IIF Policy Paper identifies two critical uncertainties shaping the future of the European automotive sector: demand for zero-emission vehicles and the stability of supply chains. Their interaction generates four plausible scenarios for the period 2025–2035, ranging from coordinated electrification to fragmented transition. These scenarios are used to assess the performance of four strategic approaches: rapid electrification, technological diversification, supply chain strengthening, and industrial cooperation.
The analysis shows that strategies centred exclusively on rapid electrification are more vulnerable than those based on resilience, diversification, and coordination. Supply chain strengthening and technological diversification emerge as the most robust approaches across scenarios, while industrial cooperation plays a key enabling role in improving adaptability. The main policy implication is that Europe should move beyond a narrow focus on technology deployment alone and instead strengthen the industrial, infrastructural, and institutional conditions that make the transition sustainable and competitive in the long term.
The IIF Policy Papers are reports on key topics in the research carried out by the IIF – Italian Institute for the Future, produced by young researchers thanks to grants funded by the 5×1000.
This IIF Policy Paper applies a strategic foresight approach to the European automotive sector to support more resilient and adaptive decision-making. It examines how different combinations of market demand, supply chain stability, infrastructure development, and digital transformation may shape the future of the industry. It also evaluates how alternative industrial
strategies perform across these conditions, identifying those that are more robust, vulnerable, or adaptable.
The analysis highlights a key policy implication: strategies based solely on rapid electrification are insufficient if not supported by strong supply chains, infrastructure, and demand conditions. Instead, resilience, diversification, and coordination emerge as critical priorities for ensuring the longterm competitiveness of the European automotive ecosystem.
The objective of this policy paper is therefore not to predict a single future, but to clarify the range of possible developments that policymakers and industry stakeholders must consider when designing strategies for the coming decade. By making uncertainty explicit, the analysis aims to support more informed decisions and to strengthen the capacity of European institutions to manage complex industrial transitions.
Author
Roberto Cirillo
Roberto Cirillo is a PhD candidate at the University of Campania "Luigi Vanvitelli" and holds a degree in Economics and Management. He won the Italian national Non Sprechiamo competition for an innovative entrepreneurial project. His research interests include management, sustainability, and innovation, with a particular focus on decision-making processes and organizational analysis.
