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The basic materials industries are facing significant challenges. These are largely driven by downturns in other important industrial sectors and the construction industry.
Representatives from basic materials industries unions across Europe convened to discuss the challenges for the sectors. The automotive industry’s recent downturn has indeed sent shockwaves through the supply chains. Suppliers and subcontractors from the basic materials industries such as glass and rubber have been hit particularly hard. Simultaneously, the slowdown in the construction sector has led to severe repercussions for the cement, glass and ceramics industries.
The glass industry, for example, is grappling with overcapacity across all segments, from flat glass used in buildings to speciality glass for high-tech applications. This global excess supply, coupled with declining demand, risks triggering widespread restructuring, plant closures, and workforce reductions in the near future. Problems are also apparent in the container glass market: a sharp decline in volumes since mid-2023, coupled with falling prices in 2024. This has forced several European plants to resort to short-time working and furnace shutdowns.
High energy prices are increasing the challenges of the basic materials industries. Energy-intensive processes have seen costs surge dramatically and make the sectors especially vulnerable to the soaring energy costs seen across Europe.
Participants also raised concerns about the slow development of carbon capture, transport, and storage capacities. A glaring geographical imbalance was noted: only 5% of planned storage projects are in Southern and Eastern Europe. This imbalance would lead to comparatively higher production costs in these regions, as industries will need to transport large amounts of carbon to Northern Europe for storage.
The coming years will see a focus on transitioning to a more circular economy, a shift that demands the basic materials industries adopt environmentally sustainable practices while enhancing industrial resilience and safeguarding workforce welfare. Trade unions insist that this transition must ensure good working conditions in emerging circular activities such as recycling and reprocessing.
Judith Kirton-Darling, General Secretary of industriAll Europe, stressed:
“The combination of these challenges requires urgent strategic action. It’s a perfect storm. Without decisive measures, these critical foundation industries could further destabilise, ultimately leading to plant closures and additional layoffs. We emphasise the need for immediate action to prevent further loss of industrial capacity in Europe. Trade unions are calling for a proactive industrial plan and urging governments and employers to implement job protection schemes and fair transition plans.”