Robert Bosch is considering closing a plant in Munich that makes components for cars powered by inside combustion engines, local newspaper Muenchner Merkur said on Sunday.

Germany’s coming transition from combustion to electrical cars will end in “considerable overcapacity and the need for adjustment,” in response to a corporation spokeswoman cited by the newspaper.

Demand for the plant’s merchandise, which embody electrical gasoline pumps and injection valves, will decline throughout the subsequent couple of years, weakening the positioning’s competitiveness, in response to an inside doc quoted by the newspaper.

Bosch’s switch is an indication of how the shift to electrical autos is already reshaping German enterprise.

Europe’s best financial system expects to have 14 million electrical and plug-in hybrid autos on its roads by 2030 as a result of it makes an try to regulate to increasingly stringent European Union emissions tips.

The federal authorities’s forecast is a minimum of 40 % bigger than a earlier estimate attributable to a modern surge in EV product sales, Monetary system Minister Peter Altmaier acknowledged this month.

Last week, the EU unveiled plans to meet stricter 2030 native climate targets on one of the simplest ways to eliminating emissions by mid-century. The bloc proposed that emissions from new cars fall by 55 % from 2030 and drop to zero from 2035.

The protection will bolster demand for electrical fashions, and automakers are preparing. Volkswagen Group, the world’s largest producer, expects better than 70 % of its namesake mannequin product sales to be electrical from 2030.