Overview

• Key German automakers, including BMW, Mercedes, VW, and Porsche, reported profit declines of 26% to 43% in Q1 2025, reflecting ongoing financial struggles.
• Volkswagen plans to cut 35,000 jobs in Germany by 2030, with ZF Friedrichshafen, Continental, and Schaeffler also announcing significant workforce reductions.
• Sales in China, a critical market for German automakers, continue to slump as local competitors gain ground, exacerbating overcapacity issues.
• The transition to electric vehicles, which require fewer components and less maintenance, is disrupting supplier networks and threatening service industry jobs.
• Germany’s auto sector, historically a cornerstone of its economy, now faces structural challenges, with output and profits reverting to pre-pandemic levels last seen in 2017.