Recession Hits Germany

[Rat Catcher]

Germany in crisis: Intel and Volkswagen mull a multibillion-dollar withdrawal from the country

Ryan Hogg
Updated Wed, Sep 4, 2024, 3:48 PM GMT+13 min read

Germany’s economy has watched some of its largest companies vote with their feet and dollars since its manufacturing industry entered recession more than two years ago. Now, Volkswagen and Intel are poised to add more pain to the country’s coffers in what looks increasingly like a doom loop for the embattled country.

Volkswagen, the jewel in Germany’s industrial crown, is turning sour on its native home, which it sees as compounding its struggle to expand its profit margins.


For the first time in its 87-year history, Volkswagen is considering shutting down plants in Germany, where it employs around 300,000 people, as the company ramps up efforts to save €10 billion in costs.

In a statement on Monday, Volkswagen CEO Oliver Blume decried Germany’s falling industrial clout and its effect on his automaker, which is battling slow EV uptake, falling consumer demand, and the ominous threat of cheap Chinese EVs.

“The economic environment has become even tougher and new players are pushing into Europe,” Blume said in a statement on Monday. “Germany in particular as a manufacturing location is falling further behind in terms of competitiveness.

“In this environment, we as a company must now act decisively.”

The German problem

Indeed, Germany's manufacturing outlook is bleak, leaving the country’s chancellor, Olaf Scholz, in an existential bind.

Germany’s manufacturing sector has been in recession since early 2022, battered by the loss of cheap Russian energy following the country’s invasion of Ukraine, a fall-off in demand in its key export market of China, and declining consumer confidence in its own country.

In August, Germany’s manufacturing PMI, which hasn’t experienced growth for more than two years, fell to a five-month low of 42.4, contrasting with a global uptick in manufacturing output. Any figure lower than 50 is marked as a contraction.

“The recession in Germany's manufacturing sector is dragging on way longer than anyone expected,” said Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. “August saw an even steeper drop in incoming orders, killing off any hope for a quick bounce-back.

“Normally, over the last 30 years, the industry has managed to recover within a maximum of 20 months of a recession starting. But this time, things are different, and China seems to be the main culprit,” de la Rubia added.

Read on @ https://finance.yahoo.com/news/germany-crisis-intel-volkswagen-mull-105751082.html

[silverbullet]

Germany in crisis: Intel and Volkswagen mull a multibillion-dollar withdrawal from the country

Ryan Hogg
Updated Wed, Sep 4, 2024, 3:48 PM GMT+13 min read

Germany’s economy has watched some of its largest companies vote with their feet and dollars since its manufacturing industry entered recession more than two years ago. Now, Volkswagen and Intel are poised to add more pain to the country’s coffers in what looks increasingly like a doom loop for the embattled country.

Volkswagen, the jewel in Germany’s industrial crown, is turning sour on its native home, which it sees as compounding its struggle to expand its profit margins.


For the first time in its 87-year history, Volkswagen is considering shutting down plants in Germany, where it employs around 300,000 people, as the company ramps up efforts to save €10 billion in costs.

In a statement on Monday, Volkswagen CEO Oliver Blume decried Germany’s falling industrial clout and its effect on his automaker, which is battling slow EV uptake, falling consumer demand, and the ominous threat of cheap Chinese EVs.

“The economic environment has become even tougher and new players are pushing into Europe,” Blume said in a statement on Monday. “Germany in particular as a manufacturing location is falling further behind in terms of competitiveness.

“In this environment, we as a company must now act decisively.”

The German problem

Indeed, Germany's manufacturing outlook is bleak, leaving the country’s chancellor, Olaf Scholz, in an existential bind.

Germany’s manufacturing sector has been in recession since early 2022, battered by the loss of cheap Russian energy following the country’s invasion of Ukraine, a fall-off in demand in its key export market of China, and declining consumer confidence in its own country.

In August, Germany’s manufacturing PMI, which hasn’t experienced growth for more than two years, fell to a five-month low of 42.4, contrasting with a global uptick in manufacturing output. Any figure lower than 50 is marked as a contraction.

“The recession in Germany's manufacturing sector is dragging on way longer than anyone expected,” said Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. “August saw an even steeper drop in incoming orders, killing off any hope for a quick bounce-back.

“Normally, over the last 30 years, the industry has managed to recover within a maximum of 20 months of a recession starting. But this time, things are different, and China seems to be the main culprit,” de la Rubia added.

Read on @ https://finance.yahoo.com/news/germany-crisis-intel-volkswagen-mull-105751082.html

We should organise a protest in support of the Germans by meeting up at the IRA statue of Séan Russell in Fairview Park.

If Germany goes to war then the IRA could finally realise their dream of being collaborators again.

Bring back Mary-Lou, Mary-Lou was great so she was!

[Rat Catcher]

She hasn't gone away...

[Octavia1]

Couldn't believe it today drivin past the vw dealer at deans grange .... now byd

[watty]

Probably other reasons for the move but VW Group to sell cars directly to Irish customers for all its brands from 2026 (Irish Times, May 2024)

Volkswagen Group is to sell its new cars directly online to Irish customers from June 2026, in a move that will see its retailers become responsible for new car handovers rather than the sales process.  VW Group Ireland will sell new vehicles directly online to customers across all its six brands – Volkswagen Passenger Cars, Skoda, Seat, Cupra, Audi and Volkswagen Commercial Vehicles.

The change will end the group’s current contracts with its Irish dealers. The Irish Times understands that dealers across the group’s brands were informed on Monday that their current contracts were being terminated and that new contracts would be issued introducing the new agency sales model.

VW Group Ireland has yet to indicate how many of its current dealers will be offered the new contracts and how it will pay dealers who sign up to the new sales model, where they are paid a set fee for managing the handover process for new cars to customers rather than a profit margin on the sale.

[Octavia1]

https://www.nytimes.com/2024/09/05/business/economy/jobs-report-federal-reserve.html

[Octavia1]

Stock market cud crash again tomorrow....great fun

[John m]

OCCI AI will replace Car Sales people same with most Sales People .You will go on line they will know everything about you and offer you a car to suit your Personality or Insurance based on Driving Style or what food and drink you buy when out shopping .You EXIST now not Live .Trinity College be Doing Courses in Deliveroo and Just Eat merchandise distribution management as in showing you the pedals and brakes and how to change a saddlebag .