European automotive sales dropped from nearly 18 million in 2019 to approximately 13 million in 2025. German manufacturers face increased competition from Chinese brands and potential US import tariffs, which are currently set at 25 percent.
Volkswagen Group is considering the closure of four German factories. The company recently recorded a write-down of $11.5 billion, with $6.9 billion attributed to its 75 percent stake in Porsche. Porsche's profit margins have declined due to slowing sales in China and an oversupply of electric vehicles.
Volkswagen brand head Thomas Schaefer announced plans to accelerate workforce reduction measures originally agreed upon in 2024. Meanwhile, Mercedes-Benz has warned employees of potential closures involving one assembly plant and one powertrain facility in Germany to reduce costs.
The IG Metall union organized protests involving workers from Audi, BMW, Mercedes-Benz, Porsche, and Volkswagen, alongside their suppliers. Union leader Christiane Benner called on management to prioritize the stability of the German automotive industry and its workforce.
