Volkswagen stops production: demand for electric cars collapses!

Volkswagen stops production: demand for electric cars collapses!

Volkswagen is currently under pressure because production is temporarily stopped in several German plants due to a lack of demand for electric cars. Renowned locations such as Zwickau, Dresden, Emden, Hanover and Osnabrück are affected. In Zwickau, production of the ID.3 and the Cupra Born will be stopped for several days from October 6th. The Transparent Factory in Dresden is also taking a break. Closing times for the production of the ID.7 are planned in Emden; Discussions with the works council are still ongoing here. In Hanover there will be five days of standstill for the production of ID.Buzz and Multivan T7 during the autumn holidays. Osnabrück will reduce production by at least one day per week until the end of the year, with a full week of shutdown in October. These measures are a direct result of overfull warehouses and empty order books - a clear response to weak demand in the electric car market, as Investment Week reports.

But why this sudden withdrawal? One reason lies in the export markets, particularly in the USA, where demand is weak. An additional US tariff surcharge on the Audi Q4 e-tron worsens the situation. This shows that the initial euphoria for electric cars is giving way to sobering realism. Volkswagen is not only fighting against persistently weak demand for the new ID models, but also has to deal with structural problems, including delays in software and negative effects on the group result from the weak subsidiary Porsche. All of this is putting additional pressure on Volkswagen's share prices, while competitor BMW is convincing investors with solid figures.

A look at the production numbers

The current situation contrasts with the production figures of previous years. According to the Association of the Automotive Industry (VDA), 1.35 million electric cars were produced in Germany in 2023, an increase of 7% compared to the previous year. Battery electric vehicles (BEVs) accounted for 1.06 million units, an increase of 11%. A further increase in electric car production by 24% to 1.67 million units is forecast for 2024, as reported on Welt.

Nevertheless, current registration figures show a mixed result. In January 2024, there were a total of 207,600 new cars in Germany, which corresponds to a decline of 3%. However, over a quarter of these new registrations are electric vehicles, with electric bestsellers particularly standing out with 52,220 new registrations, an increase of 42% compared to the previous year. A neutral look at the numbers makes it clear: the industry is facing major challenges.

Conclusion and outlook

The simultaneous production stops at Volkswagen are a strong signal to the entire automotive industry. The transition phase to electromobility involves many hurdles that need to be overcome. While some plants are reducing production due to weak demand, there is still a lot of activity in Wolfsburg, as special shifts are planned for the production of classic combustion engine models. This is also reflected in the fact that additional shifts will be carried out in Wolfsburg almost every weekend until Christmas in order to meet the ongoing demand for models such as the Golf and Tiguan, as Tagesschau reports.