Job losses mount in German automotive sector as challenge from China intensifies
Germany’s automotive industry shed 42,300 jobs in the year to the end of June, sending employment to its lowest level since 2005 as carmakers grappled with falling profits in China and mounting competition from Chinese brands in Europe, and industry groups warned that worse was yet to come. With job losses spreading across German industries, the automotive sector was hit the hardest, recording a…
Germany's automotive sector lost 42,300 jobs in the year ending June, reaching its lowest level since 2005, according to the Federal Statistical Office. The sector's employment declined by 5.8%, while the manufacturing sector as a whole saw a 2.7% drop in workforce. Volkswagen and Mercedes-Benz cited weak demand in China and rising competition from Chinese brands in Europe as the primary factors behind their profit drops.
The industry faces an uncertain future as Chinese carmakers are projected to capture 15-30% of the European market by 2035, according to Citi analysts. Volkswagen CEO Oliver Blume called on Brussels to address tariffs for Chinese plug-in hybrids, while the German Economic Institute's Thomas Puls warned that job losses could continue, with 225,000 jobs expected to be lost by 2035 compared to 2019.
Suppliers are pushing for EU rules requiring more local production to access subsidies, while carmakers are less enthusiastic. The German Association of the Automotive Industry expects 225,000 job losses by 2035, with about 100,000 already occurring. Puls emphasized the need for Europe to address weak demand, particularly by enhancing public charging infrastructure, but acknowledged that the German car industry would need to shrink.
Written by urgent.news from SCMP Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
