‘Golden age’ is gone: German car crisis hits young engineers

Despite a year of job hunting, experience with leading automotive suppliers and submitting about 50 applications, German software engineer Max Peil has yet to secure a new position.

Trained in computer vision, a critical part of autonomous and intelligent driving systems, Peil could once have expected to sail into a role at one of Germany’s industrial giants.

But years of stagnant growth in Europe’s biggest economy and increasingly fierce Chinese competition are now taking their toll on young engineers like Peil.

“Usually you just get rejected straight up,” the 30-year-old told Agence France-Presse (AFP) in the western city of Frankfurt.

“I’ve had one interview. It was the same with my friends, one has sent over 60 applications.”

‘Golden age’ gone

Known the world over for cutting-edge technology and innovative design, Germany’s car industry, powered by exports, has so far managed to avoid the drastic decline seen in countries like Britain, France and Italy.

But Chinese carmakers like BYD and XPeng have eaten into German carmakers’ sales in the world’s largest auto market, leading to painful adjustments at home.

“Ten years ago we made about 6 million vehicles a year, and we’ve now stabilized at about four, 4.2 million,” transport economist Thomas Puls of the IW economic institute in Cologne told AFP.

“That’s good compared to other European countries, but we now need to accept that the golden age is not coming back.”

In a sign of the times, workers on Thursday protested at Volkswagen sites across the country over reports that Germany’s biggest carmaker is mulling up to 100,000 job cuts.

Total employment in the German automotive sector fell 8% in the five years to 2025, according to Federal Employment Agency (FEA) data, even as it grew a little over 1% overall.

German industry as a whole is struggling against what some have dubbed the “China Shock 2.0” as the country’s firms shift away from low-value production and into making more high-tech goods, often at lower prices.

This is pushing German companies out of once-reliable export markets.

Total German exports were 1.56 trillion euros ($1.78 trillion) last year, down almost 2% from a 2022 peak, according to data from the country’s statistics office, Destatis.

Exports to China, meanwhile, plunged almost a quarter to 81.3 billion euros over the same period.

For Peil, who last year completed a traineeship at tire-maker and industrial supplier Continental before it spun off its automotive business, the crisis meant it was clear he would not be taken on.

“Even when I started, you could see, and you’d always read about it in the news, that this or that part of the business was being restructured,” he said.

“And when you see experienced colleagues going, then you know it’s unlikely you’ll be hired for the role.”

‘What’s wrong?’

Anja Robert, who for 20 years has led the careers service at one of Germany’s leading engineering schools, told AFP that even some of the best students now had to search for a while.

“There are people who come to us and say, ‘Wow, I’ve written 30 applications and heard hardly anything back: What’s wrong?,'” said Robert, head of careers at RWTH Aachen University.

“It’s not the case anymore that you just get your application in with BMW and you get a job.”

Qualified engineers last year had an unemployment rate of 3.8%, according to the FEA data, an increase of almost 50% compared to 2022.

Electrical engineer Luca Linhsen is one of the luckier ones, as she took up a job as a software consultant in Hamburg this month.

But she still had to endure a “frustrating” months-long job hunt.

“As engineers, we were led to understand when beginning our studies that you’ve practically got a job even before finishing the degree,” she told AFP.

“If you want to study engineering, do it because you have a passion for technology. Don’t do it for the money or the job security.”

DAILYSABAH