The German automotive industry expects the loss of a further 125,000 jobs by 2035. The industry association VDA announced on Wednesday that job cuts threaten to be more extensive than previously assumed. The primary driver is the transition to electric mobility: manufacturing an EV is less complex and requires fewer components than an internal combustion engine (ICE) vehicle. Consequently, jobs are being eliminated, particularly among suppliers. New positions created as part of the transformation toward future climate-neutral and digital mobility are being established abroad, given the poor and internationally less competitive local conditions.

'The development is alarming and demonstrates that Germany is facing a persistent and severe crisis as a business location; production conditions in Germany are deteriorating visibly,' said VDA President Hildegard Müller. The exodus of companies will not remain without consequences for the country's prosperity and social and political stability.

In this context, the VDA advocated for a reversal of the European Union's ICE ban. Should vehicles with internal combustion engines or range extenders still be permitted for registration after 2035, 50,000 of the currently threatened jobs could be preserved. The concept of excessive regulation has failed, Müller said. She argued that for success to be achieved, climate protection must be a viable business model integrated with growth and prosperity. 'Technological neutrality must not be mere lip service; it must be practically achievable,' she stated. Current proposals from the EU Commission are insufficient in this regard. 'Instead of a course correction, instead of the necessary flexible path, they are doubling down on further regulation - and changing nothing in the process.'

At the end of 2025, the EU Commission proposed that CO2 fleet emissions for new cars must only decrease by 90 percent compared to 2021 levels starting in 2035, instead of the previously planned 100 percent. This would allow new hybrid vehicles to be registered even after that date. However, automakers must offset these emissions through measures such as the use of green steel or the blending of climate-neutral fuels. Simultaneously, stricter CO2 rules apply to fleet operators, such as car rental companies.

(Report by Christina Amann, edited by Sabine Wollrab. For inquiries, please contact our editorial office at Berlin.Newsroom@thomsonreuters.com (for politics and economics) or Frankfurt.Newsroom@thomsonreuters.com (for companies and markets)