Two days after Porsche announced another round of layoffs involving 5,000 of its employees in its home country, BMW Group has just made a similar announcement that suggests the German industry’s main engine is misfiring.
BMW today said it would cut several thousand jobs in Germany by the end of 2027 under a voluntary redundancy program, Reuters reports.
Approximately 8,000 Job Cuts or 10% of BMW Group’s Headcount in Germany
BMW
A company spokesperson told the news agency that the severance program agreed between the automaker and the works council targets the administration and development departments and excludes production operations.
The total number of employees that will lose their jobs is approximately 8,000, according to a person familiar with the matter cited by Reuters. That’s a massive amount as it represents almost 10 percent of BMW Group’s German headcount and 5 percent of its global workforce of approximately 155,000 people.
“The BMW Group is proactively shaping the profound changes taking place in its operating environment. These include the technological transformation of the automotive industry, geopolitical uncertainties, changing market conditions and developments in China,” a company spokesperson said according to The Guardian.
The news comes as Volkswagen Group and Mercedes-Benz Group have already announced tens of thousands of job cuts. Germany’s automotive industry is under pressure from the costly shift to EVs, intense competition from China resulting in massive sales declines in the world’s largest car market, the financial burden of U.S. tariffs, and the loss of cheap energy from Russia.
Germany’s Top Industry Is Affected by a Perfect Storm
BMW
German carmakers have been subject to intense pressure in recent years as Chinese rivals have risen and quickly come to dominate their domestic EV market. Chinese carmakers have also launched a price war in China, which had previously been a gold mine for European brands exporting cars there.
Before today’s announcement, BMW Group was believed to be more successful at weathering the current storm affecting the German auto industry. But in June, the luxury carmaker cut its profit outlook for 2026, citing sharp sales declines in China. Not long after that, BMW’s new CEO Milan Nedeljkovic, who was previously head of production, said the automaker would accelerate ongoing cost-cutting efforts.
According to an attendee at today’s workers assembly in Munich cited by Reuters, Nedeljkovic told staff that the rules dictating industry had substantially changed and with it the foundation of BMW’s business model. The head honcho warned of challenging times ahead but noted that the restructuring measures were key to insuring the company becomes more profitable, the source added.
BMW will report its second-quarter earnings on Thursday, July 30.
