Mercedes-Benz Stops All German Investments

The news comes from an internal memo, but thanks to Reuters, among others, that memo did not remain internal for long. Mercedes is taking a rigorous stance against high production costs in its home country. Mercedes-Benz reportedly failed to reach an agreement with unions and the works council in Germany regarding cost reductions and is therefore taking this drastic step. Nothing concrete has been said yet about closing factories, but it has been stated that this is part of the plans.

In September, Mercedes-Benz was already looking for ways to make significant cost cuts in Germany. At that time, the possibility that two German factories would have to close was already mentioned. For experts, Mercedes’ steps come as no surprise. “Mercedes has been emphasizing for months how difficult the situation in Germany is,” analyst Ferdi Dudenhöffer told Reuters. He calls the current situation the ‘biggest crisis ever’ for the German automotive industry. Consultancy firm Roland Berger warns Automotive News Europe that at least 200,000 jobs in the German automotive industry could be lost by 2030.

Indeed, the misery certainly does not affect only Mercedes. We know, particularly from Volkswagen, that for the first time in history, very rigorous cuts are also coming to German operations. Chinese competition, rising personnel costs, and complex regulations are key factors.

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