In Børsen on 6 December, several experts declared the challenges facing the German automotive industry to be a problem for the entire national economy.

It is true that the German automotive industry is in a critical phase. The transition to electric vehicles has reignited global competition, where Chinese manufacturers currently hold a significant lead.

Electric motor technology differs fundamentally from combustion engines. While German engineers were previously world leaders in complex mechanical systems, the future of the automotive industry now revolves around battery technology and software – areas where Germany has traditionally had less experience.

Nevertheless, there are reasons for optimism. In 2023, Germany accounted for the largest share of global electric vehicle exports. BMW has already surpassed Tesla in Europe, and German manufacturers are demonstrating adaptability.

Germany’s highly skilled workforce and robust dual education system are key strengths. The transition in the automotive industry from combustion engines to electric motors requires substantial labor market restructuring, including worker mobility across roles and significant investment in new skills. The dual education system is well-positioned to play a pivotal role in this transformation, facilitating reskilling and enabling German workers to adapt swiftly to emerging industries and technologies.

Looking ahead, innovation will be essential for maintaining global competitiveness. Germany already invests over three percent of its GDP in research and development. The technologies of the future often rely on strong collaboration between cutting-edge research and industry. Strengthening partnerships between universities and industry could further bolster Germany’s competitive edge.

The challenges are significant. Chinese manufacturers are driving down prices and are ahead in battery technology, which is advancing rapidly. But with a well-educated workforce, a strong culture of innovation, and a willingness to adapt, Germany still has the potential to remain a central player in the automotive industry of the future.