‘If VW disappears, individuals will not keep within the city anymore’ – fears over Trump’s automobile tariffs

At one manufacturing unit in East Germany, they’re pumping out a automobile half each second, slicing and urgent thousands and thousands of items destined for the nation’s mega motor business.

The HENNgineered plant sits on the sting of Zwickau, a metropolis the place the automobile is king. And on the subject of autos, America is Germany’s most vital buying and selling associate.

In 2024, automotive exports to the US reached a complete worth of €36.8bn (£30.7bn), in response to the German Car Affiliation.

So, Donald Trump’s resolution to introduce 25% tariffs on all passenger vehicles and light-weight industrial autos imported into the US is an enormous downside for producers and suppliers alike.

Volkswagen is now the primary native employer, offering round 10,000 jobs.

Learn extra: Trump’s automobile tariffs condemned

However automobile constructing is in individuals’s blood, with the primary car made right here round 120 years in the past.

The town museum proudly shows vehicles by means of the ages.

One room hosts shiny silver racing vehicles, one other brightly colored Trabants.

The town developed vehicles from the German empire proper by means of to the present trendy republic, explains Thomas Stebich, head of August Horch Museum.

Whereas the stainless automobile shows rejoice town’s pioneering previous, tariffs are making many really feel unsure concerning the future.

“If no person within the US buys a German automobile or much less individuals purchase German vehicles, it is going to have an effect, after all, as a result of we have to construct excessive numbers of vehicles right here [for jobs],” Stebich says.

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If you wish to perceive how key the auto business is to German id, assume mining to the UK in its heyday.

Round 700,000 persons are employed within the business, which generates greater than 540 billion euros in gross sales a yr.

However tariffs will not be the primary storm German automobile producers have needed to climate.

Excessive vitality and labour prices, competitors from China and weaker home demand as a result of ailing economic system imply the German automobile business has been slicing jobs.

Audi not too long ago introduced it is going to minimize 7,500 administration jobs by 2029.

By 2030, VW will lose 35,000 roles.

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They don’t seem to be the one ones, however Trump’s tariffs information comes as a contemporary blow to employees.

A consultant on the VW works council in Zwickau cancelled our interview on account of disaster talks.

All the employees we met appeared pessimistic and deeply fearful for the plant and town’s future.

Their concern is shared by Aliriza Oernek, who owns 4 eating places in Zwickau.

He says lately they’ve seen a lot of their younger individuals go away the world to hunt jobs elsewhere. He fears contemporary ache from tariffs will harm the entire neighborhood.

“Volkswagen is the largest employer in Zwickau, the primary supply of cash for individuals who reside right here. In the event that they have been to vanish, then individuals will not keep within the city anymore,” he says.

Like its counterparts, Volkswagen is carefully watching developments round tariffs and assessing how they might impression the availability chain and manufacturing.

All eyes are at the moment on the European Union to see the way it will retaliate.

In an announcement, a spokesperson for VW Group stated they “share the evaluation of most consultants that US tariffs and any counter-tariffs can have unfavourable penalties for development and prosperity within the US and different financial areas… and proceed to advocate for constructive talks”.

So, whereas automobile makers brace for impression, Germany’s vowed it is going to “not take this mendacity down”, calling for a “agency response” from the EU because it tries to guard its automakers from this new American assault.