Germany demands EU action against China to defend carmakers
Growing Chinese competition, compounded by weak domestic demand and US tariffs, has thrown the German auto industry into crisis.
Frankfurt - Germany's Finance Minister Lars Klingbeil urged the European Union to take stronger action against what he described as China's unfair trade practices to safeguard the country's struggling carmakers. After talks with staff representatives and local politicians in a visit to Volkswagen's headquarters in Wolfsburg, Klingbeil expressed that Germany would not be naive in its dealings with China.
The German auto industry is in crisis due to intense competition from China, weak domestic demand, and US tariffs, leading to job cuts at Volkswagen, Mercedes-Benz, and BMW. Berlin seeks concrete measures from Brussels, which manages the EU's trade policies, focusing on plug-in hybrids and local content requirements. The EU has already imposed higher tariffs on Chinese-made electric cars but calls have grown to extend these levies to hybrid vehicles.
Staff representative Daniela Cavallo highlighted the challenging and unfair competition with China, demanding higher tariffs for Chinese-made hybrids. Lower Saxony's leader, Olaf Lies, acknowledged the need for China as a partner but stressed the importance of equal rules for both countries. Volkswagen plans to cut 50,000 more jobs globally, totaling 100,000 or 15% of its workforce, and the IG Metall union has called for nationwide protests demanding greater protection for the auto industry.
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