A general view of the production lines in the Mercedes-Benz meeting on June 4, 2025 in Rastatt.
Florian Wiegand | Getty Images News | Getty pictures
A perfect storm of industry and economic challenges has burdened the German car sector, which has replaced tens of thousands of jobs for over a year until the end of June.
During this period, the German car industry, one of the largest sectors in the European country, found work cuts of almost 7% of the workforce or around 51,500 positions. This is based on a new analysis of EY from the data of the German statistics office destatis.
In the 12 months to June 30 of this year, around 114,000 in the entire German industry was around 114,000 in the entire German industry. The numbers suggest that the car sector corresponded to almost half of the cuts.
“No other industrial sector has recorded such a strong job reduction,” says the report of a CNBC translation. The study marked that 112,000 jobs were reduced in the car sector compared to the 2019 period before Covid-19 pandemic.
Jan Brorhilker, managing partner of the Assurance Division at EY in Germany, said in a press release that the work cuts are due to the difficult situation of the German auto industry.
“The massive decline in profits, overcapacity and sick foreign markets make it impossible to avoid a significant reduction in jobs,” he said according to a CNBC translation.
EY’s report also found that the income in the sector in the second quarter of 2025 had withdrawn 1.6% compared to the same period last year. On the one hand, the German Auto -Glow Volkswagen reported a strong decline in profit in the second quarter and lowered its overall years.
The decline in the car sector is in particular a smaller decline than the loss of sales of 2.1%with which the German overall industry is faced.
Assembly fights
The German auto industry has long fought for a variety of challenges, such as For example, a strong Chinese competition for costs and innovation as well as difficulties in gaining ground in the electric vehicle race that have attributed some car manufacturers and analysts of bureaucracy and regulation of the federal government.
US President Donald Trump’s trade policy has contributed to the concerns. Germany and especially its car sector are very export -oriented and count the USA as one of its largest markets in which the label “Made in Germany” was historically viewed as a sign of quality.
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The latest data from destatis showed that the exports of the car and car section to the USA decreased by 8.6% in the first half of 2025 compared to the same period last year. Car manufacturers have also repeatedly warned of the potential effects of tariffs and surrounding uncertainties.
The industry can enjoy relief after details of the US-EU trade agreement have arisen at the beginning of these months. Cars are subject to 15% duties, but only after the EU has made changes to reduce its industrial taxes.
The state of Germany’s overall economy was also a headwind for the car sector, whereby the country’s annual gross domestic product declined in both 2023 and 2024. This year it also seemed to be a slow start: After Europe’s greatest growth in the first quarter of 0.3% recorded the growth of 0.3%, the latest figures for the second quarter indicate 0.3%.
With a view to the future, EY Brorhilker expects that German autoXports in the USA and China would remain under pressure. The former is influenced by the weakening of the demand, which is also a domestic problem, by tariffs and the latter.
Since various German industrial agents are currently undergoing restructuring or cost reduction programs, “the number of jobs in the industry will continue to decrease,” said Brorhilker.
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