Key facts
- German carmakers' Q1 revenue declined by 4%.
- Global auto groups' revenue rose 2% in Q1, led by Japanese and US manufacturers.
- EY warns of continued pressures from structural transformation, market losses, and high investment costs.
German carmakers saw a 4% revenue decline in Q1, lagging behind global competitors. EY warns of continued pressures from structural transformation, market losses, and high investment costs, projecting 2026 as another crisis year for the industry.
The struggles of German carmakers highlight significant challenges within a major global industry, impacting employment, supply chains, and the broader European economy as they navigate a costly transition to electric mobility amidst geopolitical and market uncertainties.
German carmakers experienced a 4% decline in revenue during the first quarter, falling behind competitors. Global auto groups, by contrast, saw a 2% revenue increase, with Japanese and U.S. manufacturers leading the trend. EY sector specialist Constantin Gall attributed the downturn to the industry's profound structural transformation, citing losses in key markets like the U.S. and China, costly overcapacity, high software investments, and the slow ramp-up of electric mobility. The Iran crisis, coupled with expected higher fuel prices and inflation, is anticipated to dampen demand in Europe. Gall warned that German carmakers can expect the decline to continue, projecting 2026 to be another crisis year for the automotive industry.
Pick the topics you care about. Get only what matters, on your cadence.