The German automotive lobby has sharply criticized the European Union for failing to grasp the severity of the challenges facing the continent’s car industry.
Presenting a recent survey, the head of the VDA industry group warned that nearly three-quarters of German automotive firms plan to delay or cancel investments in their home market due to EU policies.
Hildegard Müeller, accused Brussels of denying reality and relying on “illusions about its own relevance,” stressing that
reality catches up with us time and again.
Europe’s car sector was already struggling before tariffs imposed by U.S. president Donald Trump last year, having invested billions in electric vehicles (EVs) amid weak demand and rising competition from Chinese manufacturers such as BYD.
Major companies such as Volkswagen, Mercedes-Benz, and BMW have seen declining sales in key markets including China, while France’s Stellantis reported a €22 billion loss following the write-down of its EV operations.
Müeller argued that EU promises to reduce bureaucracy for carmakers had largely gone unfulfilled.She criticized the bloc’s recent partial easing of the 2035 petrol engine ban as “lip service” to deregulation, noting that European Commission president Ursula von der Leyen had promised to get rid of the bureaucracy at the start of her second term:
In 2025, the European Union introduced more legislation than at any point in the last 15 years, four laws a day. We cannot keep up with implementing them.
The VDA chief also cautioned that the proposed “Made in Europe” industrial strategy, supported by over 1,000 CEOs, risks adding bureaucracy and harming sales abroad:
Our supply chains are closely intertwined internationally…. cutting ourselves from the rest of the world also presents the danger of countermeasures from other countries.
