German cars become electric, but not without consequences for industry

Germany is gearing up for next Sunday‘s elections. Whoever becomes ‘the new Angela Merkel‘: one of the themes the Chancellor gets on his plate in the coming years is the automotive industry. This sector is the main driver of the German economy, but is facing major changes due to the new sustainability requirements.

For example, the largest car manufacturer in the country, Volkswagen Group, wants to make electric cars in ten years. While the vast majority of production now consists of combustion engine cars: nine million petrol and diesel cars roll off the tire every year.

โ€œThat means they have to rebuild their factories and retrain tens of thousands of employees,โ€ said Simon Hage, car expert at the German weekly Der Spiegel. โ€œThat’s a giant tour of power.โ€

In

the meantime, the company is making more and more electric cars, but that brings economic challenges. The production requires fewer staff than diesel and petrol cars.

That worries Siebert Kloster. He is a member of the Volkswagen Works Council. โ€œThere are 47,000 people working at Volkswagen, plus a number of temporary forces,โ€ says Kloster. He fears a lot of jobs will be lost. โ€œI fear not for myself, but for the future of my three adult sons and my grandchildren.โ€

Volkswagen and Wolfsburg – the city where the factory is located – have been of great importance to the German economy for many years. That started after World War II: soon they became the example of Wirtschaftswunder, the country‘s post-war economic recovery:

Der Spiegel journalist Simon Hage thought a few years ago that the cover would be a step too far for the Volkswagen group. โ€œBut in the meantime, I’m still looking at how ambitious they are doing it. They invest in EUR 70 billion in new technologies over the next five years. They want to build their own batteries and build their own software department. They‘re setting up a really big operation. But whether they can manage it will have to show in the years to come.โ€

Volkswagen is by no means the only car company that works threatens to disappear due to the turn to electric. The renowned IFO institute recently calculated that this could cost the German automotive industry up to 200,000 jobs. This would disappear one-third of all jobs in the sector.

Emission Scandal

Current Chancellor Angela Merkel believes that Germany’s automotive industry is still โ€œnumber oneโ€. But that the automotive industry has โ€œlost a lot of trustโ€ as well.

With that last comment, she refers to the emission scandal that came out six years ago. Volkswagen put tamper software in diesel cars for years, making it look like the car emitted less CO2 than it actually did. Billion-dollar claims were the result. Last week, the lawsuit against the former top executives under whose rule the scandal took place.