Wed, 12 Feb 2025

Wed, 12 Feb 2025 Germany's once-mighty car industry is in crisis. What will it take to fix it?

With the economy a key factor in German elections this month, can the auto sector get back on the road to recovery?
Challenges facing German carmakers: 1. High labor costs: Germany's carmakers have long been criticized for their high labor costs, which make them less competitive globally. 2. Rise of Chinese brands: Chinese brands such as BYD and Geely are gaining market share in Europe and China, thanks to lower operating costs and government subsidies. 3. Protectionism: The EU has introduced extra tariffs on imports of Chinese-made EVs, while the US is considering imposing tariffs on cars shipped from the EU. Consequences for German carmakers: 1. Loss of market share: German carmakers are losing market share to Chinese brands in Europe and China. 2. Declining profits: The rise of protectionism and increased competition are putting pressure on German carmakers' profitability. 3. Job losses: The decline of the industry could lead to job losses, particularly in Germany's "car towns". Solutions proposed: 1. Investment in innovation: Dr. Ferdinand Dudenhöffer suggests that German carmakers should invest in innovation and digitization to stay competitive. 2. Government support: Simon Schütz argues that the industry needs government support after the elections later this month to remain competitive. 3. Return to traditional industrial values: Union rep Steffen Schmidt proposes that Germany should return to its traditional industrial values, focusing on innovation and technology to maintain high pay and good conditions for workers. External links: 1. [BBC InDepth](https://business-news.top/indepth): The home of in-depth analysis and thought-provoking content from across BBC Sounds and iPlayer. 2. [Get the latest news from the BBC](https://www.bbc.co.uk/news): Stay up-to-date with the latest news, including politics, business, entertainment, and more. Overall, the article highlights the challenges facing Germany's automobile industry and the need for innovative solutions to remain competitive in a rapidly changing market.
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