German car companies recorded the weakest performance in key financial indicators last year compared to international competitors, a study by audit and consulting firm Ernst & Young shows. BMW, Mercedes-Benz, and Volkswagen largely lagged in revenue, operational results, and sales volume. At the same time, Ernst & Young stated that the global automotive industry is going through a deep crisis. According to the study, the revenue of the world's top 19 car companies increased by 0.6% in 2025, while German companies collectively saw a decline of 4.1%. For comparison, Japanese companies grew by 3%, Chinese companies by 9.3%, and American companies by 0.6%. Regarding operating profit (before interest and taxes), German companies collectively saw a decrease of about 44% compared to 2024. Although American companies saw a decline of 40.4%, Japanese companies by 23.3%, and Chinese companies by 12.9%, their performance was better than that of German companies. In contrast, the situation for the two European car companies, Stellantis and Renault, was much worse, as they incurred billion-euro losses. "The automotive industry is going through a deep crisis that could threaten the existence of some companies," said Constantine Gall, an automotive expert at Ernst & Young. He explained that many companies had directed their investments towards emerging markets and accelerated the transition to electric vehicles, but the demand for electric vehicles, especially in the United States and Europe, was much weaker than expected. Gall added that companies are now changing their strategies, which has led to the write-off of billions in investments in joint battery projects, the discontinuation of some models, and new investments in combustion engines. "The result is an unprecedented decline in profits," he said. Gall also noted that the reduction in these investments does not mean abandoning electric mobility, but rather represents "a correction of highly exaggerated assumptions." He pointed out that U.S. tariff policy also contributed to increasing pressures. Gall confirmed that "costs in Germany remain extremely high" and stressed the need for more drastic measures to enhance the competitiveness of the automotive sector in Germany. "It is time for Germany to provide competitive conditions for the industry, otherwise the German automotive sector will have no chance."
