Finance
German auto industry in 'crisis' as investments, jobs move abroad, lobby says
Published by Global Banking & Finance Review®
Posted on February 10, 2026
2 min readLast updated: February 10, 2026
Quick Summary
Germany's auto industry is in crisis as investments and jobs move abroad. The VDA calls for growth measures to counteract economic impacts.
German Automotive Sector Faces Crisis as Jobs and Investments Shift Abroad
Impact of Investment Migration on Germany's Automotive Sector
BERLIN, Feb 10 (Reuters) - Germany's standing as an automotive industrial hub risks being hollowed out as investments and jobs drift abroad, an industry association warned on Tuesday, calling on Berlin and Brussels to focus on measures that spur growth.
The VDA automotive association said 72% of companies surveyed plan to dial back their investments in Germany, either by moving them abroad (28%), postponing them (25%) or cancelling them completely (19%).
The survey, conducted regularly by the lobby among automotive suppliers and medium-sized manufacturers of trailers and buses, also showed widespread job cuts in Germany.
Job Cuts and Competitive Disadvantages
Last year, just under two thirds of the 124 companies surveyed cut jobs in the country, with 87% citing competitive disadvantages.
Criticism of EU Support Measures
Currently, 49% are cutting jobs in Germany, compared with just 7% cutting jobs abroad.
"Germany is experiencing a huge crisis as a business location," VDA President Hildegard Mueller said.
"The migration of investment and employment will not be without consequences for our country's prosperity and for its social and political stability," Mueller added.
She criticised an EU package of measures to support European carmakers while transitioning to electric cars and more environmentally friendly production.
"As an automotive nation, we absolutely cannot be satisfied with the current proposals," Mueller said, calling for market-driven incentives instead of regulatory obligations.
(Reporting by Rachel MoreEditing by Linda Pasquini)
Key Takeaways
- •German automotive sector faces a crisis due to investment migration.
- •72% of companies plan to reduce investments in Germany.
- •Widespread job cuts reported among automotive suppliers.
- •Criticism of EU's support measures for carmakers.
- •Call for market-driven incentives over regulatory obligations.
Frequently Asked Questions about German auto industry in 'crisis' as investments, jobs move abroad, lobby says
1What is the automotive industry?
The automotive industry encompasses all companies and activities involved in the design, development, manufacturing, marketing, and selling of motor vehicles. It plays a crucial role in the economy and job creation.
2What is job creation?
Job creation is the process of providing new employment opportunities, typically through business expansion, new ventures, or economic growth, which helps reduce unemployment rates.
3What is economic growth?
Economic growth is the increase in the production of goods and services in an economy over time, often measured by the rise in Gross Domestic Product (GDP).
4What is a financial crisis?
A financial crisis is a situation in which the value of financial institutions or assets drops significantly, leading to widespread economic disruption, often characterized by bank failures and loss of savings.