German carmakers drop behind in international profit rankings, suppliers shed jobs
Der Spiegel / Die Welt
Germany’s carmakers have fallen behind competitors from Japan and the US in sales and profits throughout 2024, an analysis by consultancy EY has found. Volkswagen, Mercedes-Benz and BMW all scored comparatively poorly in the ranking, which was led by Japanese brands Suzuki and Honda, news magazine Der Spiegel reported. “While the leading 16 global carmakers on average increased sales by 1.6 percent in the past year, German carmakers recorded a combined sales decline of 2.8 percent,” the EY analysis found. In Japan, automotive industry sales in the same period climbed by 7.8 percent, and in the US by 5.7 percent. Regarding profits, German companies saw a decline of around 27 percent, compared to a one percent decrease for Japanese companies and a one percent increase for US brands. Suzuki increased profits by 39 percent, followed by US company General Motors with 32 percent. Germany’s Volkswagen reported a profit decline of 15 percent, still well ahead of Mercedes-Benz (-31%) and BMW (-38%). Netherlands-based company Stellantis was hit hardest with a profit decline of 84 percent.
Weak demand, especially for electric vehicles, as well as “homemade problems” such as software glitches, recalls and internal restructuring challenges all weigh on the German automakers, said EY expert Constantin Gall. “There’s a weak economy in Europe, likely drops in sales in the USA due to the new tariffs, and in China there is stiff competition for a spot in the market,” Gall argued. The new tariffs of 25 percent on European cars in the US is expected to create great challenges for German brands, for which the US market is a major export destination.
According to a report in newspaper Die Welt, the car sector is already shedding jobs due to the many structural challenges: the number of people employed in the industry dropped from 780,000 in January 2024 to 744,000 in January 2025, figures released by car industry lobby group VDA suggested. The drop by 4.6 percent means the number of jobs in the sector is now at the same level as in 2012. While the major car producers have so far remained relatively robust on maintaining jobs, industry suppliers were hit much harder and lost about ten percent of all positions in the past year, according to the article.
