The automotive industry drives the German economy to the crash route

reports Mehr News Agency Quoted by Algeria, the automotive industry boosts the German economy as Europe’s economic power became. Now, the same part is in the crisis and it brings the country with it. Automakers are facing a complete storm: changing the situation from the combustion engine that was the power of German engineering, to the less complex electric cars that Germany does not control its critical battery technology. They are also fighting by lowering the demand for electric cars in Europe, high energy and labor costs, falling sales in their key market in China, and the arrival of Chinese offensive competitors into the continent.

A heavier blow can be from US President Donald Trump; A person who threatens to impose tariffs that will ruin the free trade system, which is the basis of German export -oriented economic success.

Problems that hurt the key part of the German economy are the main cause of the possible dismissal Olaf Schultz in February 7 elections , Because voters are unhappy with his economic agenda.

While it remained less than a week to vote, Schultz’s rival Schultz, the Conservative Coalition of Friedrich Border, has 5 % support, while the Social Democratic Party of Schultz is ranked 5 %. It has. But even a conservative victory seems unlikely to provide a quick solution to the problems of the German automotive industry.

firing employees throughout the economic sectors, low-economic growth, and the feeling that Germany is no longer on the path to flourish is intensifying the darkness of space. This has contributed to the emergence of the Alternative Right Party for Germany, which is now in the second place in polls.

Although Germany enters its third consecutive year, economic problems can be traced from year 6, when carbonization efforts began and the traditional industrial power threatened it. At the same time, China, the country that the German industry once relying on big profits has become its biggest competitor.

a toxic relationship

German car giants became wealthy in China, and came on the market decades ago when domestic cars were increasing. Their Asian success helped support higher wages domestically. The trend reversed in the year when the new China’s new car market declined and declined by 5 %, and declined by 5 % in the year before the epidemic stopped global markets.
These days, the market share of three major German automakers is declining because Chinese competitors introduce cheaper electric cars that often have better technology. In year 2, BMW sales in China fell 2 %, Mercedes -Benz 2 % and Volkswagen, which considers China the largest market.

Noa Barkin Rhodium consulting said that for a long time in China, the situation was so good that the German carmakers, despite the problems that Are now experiencing, trying to revive the magic of the past decades; But for Germany, and as a result of Europe, in China, there is more than the profit of the company.

Barcin said German automakers relying on the Chinese market to Beijing against Berlin because they can basically from these dependencies To use themselves to armed.

This, in turn, China’s Risk Strategy Ursula Von In the line, the head of the European Commission is more endangered. Last year’s commission labored Germany against China’s actions and due to retaliatory concerns, it imposed customs tariffs on China’s electric cars.

The boundary has promised to cut this dependence on China, even if it costs automakers. He has warned German companies of larger investment in China and has said that if such actions fail, they would not return to the government to receive funding.

In addition to the problems of automakers, there are higher energy costs, which increased after Vladimir Putin’s comprehensive invasion of Ukraine and emphasized the inherent risk of German decision to depend on his economy on cheap Russian gas. /p>
Expensive energy also increases the costs of steel and aluminum, vital inputs for the automotive industry. Worse than that, Trump has targeted the two metals with his new tariffs.

German automakers also face the highest cost of labor in the world, the legacy of creating powerful unions and decades of heavy profits from Chinese markets. Efforts to escape these costs affect the economy.

based on a report released by the Commission on Industry Degree, from year 2 to 5, with German carmakers move to cheaper countries. Production in Germany has declined by 5 %. The industry, which has been sought by reducing sales and reducing profits, is trying to cope with it.

Volkswagen last year surprised the unions for the first time in the company’s six-year history, requesting a 5 % wage reduction and closure of three car factories in Germany.

Volkswagen did so in the face of workers’ and warning strikes and left the factories, although workers agreed to reduce salaries and benefits.

German automakers have also focused on electric cars and have invested billions of dollars to develop new models and factory equipment; But the Schultz Coalition’s decision to end the generous subsidies of electric cars caused the electric car sales market to be destroyed in Germany.
The shocks that affect the largest industry and the largest employer in Germany attract politicians. The border, along with other conservatives, calls on the European Union to abandon the gradual elimination of the combustion engine cars by year 3.
Automakers also do not deceive the idea of ​​launching EU goals, as it can disrupt their long-term investment programs towards electric cars.

The Trump agent

Trump has brought another ball into the calculations by canceling US electric subsidies and requesting a return to more oil and gas excavations. In addition, if he imposes tariffs against Canada and Mexico, he can undermine the careful planning of German automakers for the North American market and add to their main problems.

Automakers face an existential challenge in the face of the collapse of the model that made them rich in Germany and Germany. Most importantly, they need to figure out whether traditional German engineering skills are still capable of producing attractive electric cars that defeat Chinese competitors and re -turn cars into the driving force of the German economy.

Border must modify the passive German economy, infamous bureaucracy, high costs and root escape risk that are included in policies from removing debt brake and preventing government borrowing to reduce welfare benefits. .

According to experts, this probably means closer to cooperation with Brussels, as the EU will work to save the blockbank from the consequences of US-China competition. The fact that Germany is now part of the problem may make Europe also be part of the solution.

The boundary has shown its desire to do so and said in a January speech that it would provide a stronger leadership in Europe. The question is, will this be enough to save Germany and its carmakers?

Matthias Zinc CLEPA Vehicle & CEO Style = “Text-align: Justify”> Shafler said, “I would like to see Germany stronger in Europe stronger, German, but I doubt such a day.”