Pursuing a premium car strategy will cost around 300,000 jobs in the German automotive industry, according to Helmut Becker, former chief economist at BMW, and now founder and chief of the research institute Institut für Wirtschaftsanalyse und Kommunikation (IWK), based in Munich.

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In an interview with stern.de, Becker said he believes that German vehicle manufacturers have focused too intensively on the premium segment.


“If the automotive sector continues the way it has been going, I estimate that we will lose around 300,000 jobs. This process is already happening. Volkswagen is reducing its workforce, as are Daimler, Opel and Ford.


Instead of building fuel efficient, low-cost models, German companies have focused single-mindedly on increasing performance, according to Becker. “The German manufacturers have gone for faster, heavier and more expensive. We are satisfied with high-end niches and think that we have beaten off all the competition with them.” But he says that buyer trends are moving in a different direction.


According to Becker, German vehicle manufacturers such as VW are not equipped to build a car for the 21st century that can compete with the success of cars such as the Toyota Aygo, Dacia Logan, or a possible competitor from China such as a Chery.

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“VW must produce cars a third cheaper than it does at present so that it can sell cars at market prices and still have enough left to invest for the future.”


Becker sees a particular problem in the psychology of today’s managers. “There are so many egomaniacs in the German automotive industry, who would sooner put pseudo race cars onto the road than take a leading role in developing new environmentally-friendly technologies.”