German automakers face profitability crisis as revenues and profits decline

German automotive industry profitability crisis revenue decline job cuts electric vehicle transition

German automotive giants Volkswagen, Mercedes-Benz, and BMW are facing a severe profitability crisis, according to an analysis by EY. In the first half of 2026, the combined revenues of these three manufacturers fell by 2.9 percent to approximately 284 billion euros, marking the third consecutive half-year revenue decline. Their earnings before interest and taxes (EBIT) also dropped by 19 percent to 13 billion euros, the lowest level since 2020.

In the global revenue ranking of 19 analyzed automotive groups, the German manufacturers fell to 16th, 17th, and 19th places, while competitors like Tesla, Suzuki, and Geely saw significant growth. The decline is attributed to high production costs in Germany, high energy prices, and intense competition in the electric vehicle segment, particularly from Chinese brands. Sales of German automakers in China fell by 25 percent during the first half of the year.

Volkswagen is undergoing significant restructuring, including a potential 6 billion euro accounting write-down related to its Porsche stake and a reduced profit forecast for 2026. The company is also planning to set aside up to 10 billion euros by 2030 to facilitate workforce reductions, which could affect approximately 60,000 jobs. Meanwhile, BMW has announced plans to eliminate up to 8,000 jobs by the end of 2027. The IG Metall union has mobilized protests across more than 200 locations to oppose these widespread job cuts.

Entities

BMW · EY · Mercedes-Benz · Tesla · Volkswagen

Claims

What the coverage asserts, and how many sources carry each claim.

[○ 1 SOURCE] Volkswagen expects an operating margin of only 1% this year, down from a previous projection of 4% to 5.5%. veja.abril.com.br
[○ 1 SOURCE] The German automotive industry workforce is projected to drop from 830,000 in 2018 to 500,000 by 2030. economia.ig.com.br
[○ 1 SOURCE] Volkswagen aims to cut approximately 15% of its global workforce, equivalent to 100,000 jobs, by the end of the decade. economia.ig.com.br
[○ 1 SOURCE] The profit revision includes a 6 billion euro accounting write-down related to Volkswagen's stake in Porsche. veja.abril.com.br
[○ 1 SOURCE] Volkswagen plans to set aside up to 10 billion euros by 2030 to reduce its workforce, potentially affecting 60,000 jobs. biznisinfo.mk
[○ 1 SOURCE] Volkswagen reduced its 2026 profit forecast, warning of a potential negative impact of up to 10 billion euros. veja.abril.com.br
[○ 1 SOURCE] BMW announced plans to eliminate up to 8,000 jobs, roughly 5% of its workforce, by the end of 2027. economia.ig.com.br
[○ 1 SOURCE] Hourly direct labor costs in Emden, Germany, are 74 euros, compared to 37 euros in Palmeira, Portugal, and 12 euros in Tianjin, China. biznisinfo.mk
[● 16 SOURCES] The earnings before interest and taxes (EBIT) for German automakers fell by 19 percent to 13 billion euros. bizniscg.me · www.vol.at · www.zeit.de · www.biznis.ba · www.finanzen.at · +11 more
[● 16 SOURCES] German automakers ranked 16th, 17th, and 19th in a global revenue ranking of 19 analyzed automotive groups. bizniscg.me · www.vol.at · www.zeit.de · www.biznis.ba · www.finanzen.at · +11 more
[● 16 SOURCES] The combined revenues of Volkswagen, Mercedes-Benz, and BMW fell to approximately 284 billion euros in the first half of the year. bizniscg.me · www.vol.at · www.zeit.de · www.biznis.ba · www.finanzen.at · +11 more