BMW to Volkswagen: How deep is Germany's auto industry cull?
BMW joins VW, Porsche and Mercedes-Benz in cutting thousands of jobs, as Chinese rivals erode their market share. DW recaps the major reforms German automakers
BMW joins VW, Porsche and Mercedes-Benz in cutting thousands of jobs, as Chinese rivals erode their market share. DW recaps the major reforms German automakers are pursuing to safeguard their future. BMW makes five BMW on Wednesday became the fifth German carmaker to announce major job cuts, as the country's auto sector seeks to tackle rising competition from China. The Munich-based firm said it would cut up to 8,000 jobs globally, representing about 5% of its 154,000-strong workforce. BMW, which also owns the Mini and Rolls-Royce brands, said the job losses would primarily affect operations in Germany and be achieved through natural staff turnover and a voluntary redundancy program. Although BMW was seen as more resilient to Chinese competition, the company warned last month that its sales in China were falling sharply. Chinese rivals have intensified competition for electric vehicles (EV), which has crushed BMW's sales volumes and pricing power. Last year, BMW's vehicle deliveries in China dropped to their lowest level since 2017 and in the three months to June, they fell 30% year-on-year. US PresidentDonald Trump's tariffs have also contributed to BMW's woes, along with higher energy prices from the Iran war and the growth of Chinese EV-makers in other major markets, including Europe, Asia Pacific and Latin America. BMW joins other German automakers in announcing large job cuts Image: Jade Gao/AFP On Thursday, the company disclosed that second-quarter net profit dropped 35% to €1.2 billion ($1.4 billion), while revenue fell to €31 billion from €34 billion.
BMW has adjusted its guidance for the rest of the year, warning of a "significant decline" in profit. Are AI-powered robots German carmaker BMW's future? To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Even Porsche isn't immune Two days earlier, Porsche announced plans to cut an additional 5,000 jobs in Germany by the end of 2035. The figure represents about 1 in 5 workers The sports performance brand said the new measures would hit Porsche's main production plant in Stuttgart-Zuffenhausen and its research and development (R&D) center in nearby Weissach. Last year, Porsche announced a restructuring program to cut 1,900 jobs in the Stuttgart region by 2029 and allow 2,000 fixed-term contracts to expire. The company will also defer wage increases, while performance bonuses will be more closely linked to profits. Porsche, which is owned by Volkswagen Group but run with a high degree of independence, has also reduced jobs at its Leipzig plant and is closing three subsidiaries that employ about 500 people. At the end of last year, Porsche employed nearly 41,800 people, with about 85% of them in Germany. Volkswagen plans the deepest cuts Volkswagen, Europe’s largest carmaker, last month doubled its job-cull program, announcing plans to slash up to 100,000 jobs. The company also wants to close four German factories.
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