Alarming! German auto suppliers are stopping investments and fearing for the future

Alarming! German auto suppliers are stopping investments and fearing for the future

The automotive industry in Germany is facing significant challenges. According to a current survey by the Association of the Automotive Industry (VDA), the investment plans of many German automotive suppliers have deteriorated significantly. This development is primarily due to a weak economy and increasing global uncertainty. The survey shows that 76 percent of suppliers intend to either postpone their planned investments in Germany, relocate them abroad or even cancel them entirely. This is an alarming increase compared to previous surveys.

In February 2025, 14 percent of companies said they would cancel planned investments; in the most recent survey this proportion is now 20 percent. This represents the second increase in a row. In addition, around a quarter of suppliers plan to relocate their investments abroad. In February it was 29 percent.

Political uncertainties and location conditions

VDA President Hildegard Müller assesses the current situation as worrying and describes the numbers as “alarming”. There are many reasons for suppliers' reluctance. The main factors include increased international competition, geopolitical uncertainties and US President Donald Trump's customs policy. The poor location conditions in Germany also play a decisive role in companies' investment decisions.

The automotive suppliers are therefore exposed to high political pressure to act. The industry is faced with the challenge of asserting itself in an increasingly complex and competitive environment. Quick action by the responsible politicians could be necessary to ensure the competitiveness of German automotive suppliers and to promote domestic investments.

For more information on this topic you can visit the comprehensive analysis Zeit.de and Spiegel.de read up.