A finished car rolls off the assembly line at the BMW factory in Leipzig every 48 seconds, says assembly manager Martin Koch. 2025 was a record year, the second in a row. And combustion engines still make up a large part of sales.
The car industry is changing, and many German manufacturers are still in a bit of a slump. BMW is doing comparatively well. Volkswagen, on the other hand, slipped into the red in the third quarter of 2025. Mercedes-Benz AG sold around 2.16 million cars and vans worldwide in 2025 – ten percent less than in the previous year.
Sales of purely electric cars at the VW Group increased significantly in 2025. But sales on the Chinese and North American markets in particular depressed the group’s figures. China’s government pumped a lot of money into domestic car manufacturers like BYD. They rely on e-mobility and hybrid technologies – and thus overtake German producers.
Brands like Mercedes-Benz and the Volkswagen subsidiaries VW, Audi and Porsche rested on the sales of their combustion engines for too long. The change towards electromobility was initiated late – or inconsistently; Boardrooms are still attached to the combustion engine and, like Mercedes boss Ola Källenius, loudly rail against the European climate requirements for the auto industry.
VW, Mercedes and suppliers are cutting jobs
At the same time, decisions by US President Donald Trump – a hefty tariff increase and the end of government support for electric cars – dampened the success of German manufacturers in North America.
Now the corporations want to save money. At Mercedes, around 4,000 jobs are expected to have been eliminated by October 2025. Volkswagen ended just over a month ago car production in its Dresden factoryProduction in Osnabrück is also scheduled to end in 2027. 35,000 jobs are to be cut at all of the group’s ten German locations by 2030.
Other companies in the supply chain are also struggling. Not only Bosch is planning layoffs, the technology group ZF from Friedrichshafen in Baden-Württemberg has also announced that it will cut 14,000 jobs by 2028.
The Paris-based automotive supplier Valeo announced just a week ago that it wanted to close its location in Bad Neustadt an der Saale. The local union IG Metall criticized in conversation with Bayerischer Rundfunk the management that does not look for solutions together with the employees.
New purchase bonus for electric and hybrid cars
Thorsten Donnermeier, IG Metall shop steward at VW in Kassel-Baunatal, sounds similar when he talks about the car manufacturers. He advocates a reduction in working hours with full wage compensation instead of job cuts – and for increasing the capacity utilization of the car factories Production of buses and trams for local transport to boot up. This could also reduce climate-damaging emissions from road transport.
Meanwhile, the federal government has one New bonus for buying and leasing an electric or hybrid car decided to get the market going.