Germany Automotive Industry Warns of 125,000 Job Losses by 2035 Under EU CO2 Rules

The Germany automotive sector could face significant employment pressure over the next decade if policymakers fail to introduce more flexible mobility regulations, according to the German Association of the Automotive Industry (VDA). On May 13, the association stated that as many as 125,000 additional jobs may disappear by 2035 unless the European Union adopts a technology-neutral strategy and improves the region’s competitiveness for industrial investment. The industry body emphasized that current regulatory direction may weaken the country’s manufacturing ecosystem during the transition toward climate-neutral transportation.

VDA explained that greater technological openness could help safeguard nearly 50,000 automotive jobs in Germany. The association called on the European Parliament and EU member states to strengthen the European Commission’s Automotive Package by introducing more practical and flexible measures. According to the organization, a broader acceptance of multiple low-emission technologies would support industrial stability while enabling environmental targets to remain achievable for manufacturers, suppliers, and related sectors across the automotive value chain.

Projected Employment Impact on Germany’s Automotive Sector

The association warned that the European Union’s planned 2035 CO2 regulation may create major disruptions for employment within the automotive industry. Under the proposed framework, only new battery-electric and fuel-cell vehicles would be permitted for registration after 2035. VDA stated that such restrictions could place around 50,000 automotive jobs in Germany at direct risk, particularly in areas connected to conventional powertrain manufacturing, engineering, and component production.

Industry representatives argued that expanding the regulatory framework to include additional technologies could reduce the scale of job losses while supporting the transition toward sustainable mobility. The association highlighted plug-in hybrid systems, range-extender technologies, and renewable fuel-powered combustion engines as potential solutions capable of balancing climate objectives with industrial continuity. VDA stated that maintaining multiple technology pathways would provide manufacturers with greater flexibility during the transformation of the European automotive market.

Key Concerns Raised by VDA

• Up to 125,000 additional automotive jobs may be lost in Germany by 2035.
• Technology-neutral regulations could preserve around 50,000 jobs.
• Current EU CO2 rules focus only on battery-electric and fuel-cell vehicles.
• VDA supports inclusion of plug-in hybrids and renewable fuel engines.
• The association seeks stronger flexibility within the EU Automotive Package.

Germany Automotive Employment and Regulation Overview

The following table summarizes the employment concerns and policy recommendations highlighted by VDA regarding the future of Germany’s automotive sector.

VDA also stressed that Europe’s long-term competitiveness as an automotive manufacturing hub depends on policy decisions taken over the coming years. The organization believes that industrial investment conditions must improve alongside emissions policies to avoid further economic pressure on suppliers and automakers. The association maintained that climate-neutral mobility can still be achieved through a diversified technology approach rather than relying on a single propulsion pathway across the European automotive market.

Frequently Asked Questions

Why is Germany’s automotive industry concerned about the EU’s 2035 CO2 regulation?
The German automotive industry believes the EU’s current 2035 CO2 framework may negatively impact employment and industrial competitiveness across the region. According to VDA, limiting future vehicle registrations to battery-electric and fuel-cell models could place around 50,000 jobs at risk in Germany alone. The association argues that permitting additional low-emission technologies such as plug-in hybrids, range extenders, and renewable fuel-powered combustion engines would help manufacturers manage the transition more effectively while still supporting climate-neutral mobility goals across Europe.

What changes does VDA want the European Union to introduce?
VDA is requesting a more technology-neutral and flexible regulatory framework for Europe’s automotive sector. The association wants the European Parliament and EU member states to strengthen the European Commission’s Automotive Package with pragmatic measures that support investment and industrial competitiveness. VDA believes that allowing multiple low-emission propulsion technologies alongside battery-electric vehicles can preserve jobs, reduce economic disruption, and provide manufacturers with a more balanced transition pathway toward sustainable transportation and long-term climate targets.