Auto summit: Why German carmakers need help from politics

DW (English)

Germany’s automakers are suffering a dramatic sales slump that forced them to shed more than 51,000 jobs within a year. Therefore, the government has invited industry executives to find ways for a turnaround.

Transcript

00:00A forced break in Zwickau.

00:03In October, Volkswagen is halting production here for a week.

00:06The same goes for its plant in Dresden.

00:09The problem?

00:10Multi-billion Euro investments in electric vehicles aren't paying off.

00:15Many customers remain hesitant.

00:17In August, only about 15% of all car buyers in the European Union opted for a fully electric

00:23vehicle.

00:24Carmakers like Mercedes and Porsche have now abandoned their electric-only strategies.

00:29The huge problem for German manufacturers is their cost structure when it comes to electric

00:36cars.

00:37That's why we are seeing strong lobbying to delay the phase-out of combustion engines.

00:42China is light-years ahead in terms of production costs and battery technology.

00:47None of the German carmakers can compete with that, not even in the next three or four years.

00:52That's the biggest challenge.

00:56The consequences are wide-ranging.

00:58Ford Germany plans to cut 3,900 jobs by 2027.

01:03Mercedes will lay off even more employees.

01:05Volkswagen, meanwhile, intends to cut 35,000 positions.

01:09That's a quarter of all VW positions in Germany.

01:14But suppliers are also affected.

01:15Bosch is cutting 13,000 jobs, while ZF plans to cut 14,000.

01:21Across the entire German automotive sector, a total of 98,000 positions are expected to

01:26disappear by 2030.

01:28But there are other reasons behind the crisis.

01:33costs to energy prices higher than in China or in the US.

01:37And that's not all.

01:41The sticking point for Europe is the cost of legislation.

01:46Rulemakers in Europe are always adding more and more and more.

01:49That's making cars ever more expensive.

01:52The automotive industry is considered the heart of the German economy, which makes the latest

01:57developments alarming.

01:59This is, after all, the country's largest sector by revenue and employment.

02:04dispute mustін in Europe.

02:08The importance of 95 markets and rural areas is raised by 2029.

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