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BMW And German Brands Worry Openly About the Biggest Crisis Since WWII |
More than 1.5 million workers in Germany depend on the automobile industry for their jobs. But that industry is now facing one of its worst crises ever. Respected giants BMW and Mercedes are particularly exposed as sales plummet.
It was time for Martin Winterkorn to relax. The exhausted chairman of the VW Group was sitting in a leather seat on the company jet, coming from a conference in Berlin where he warned attendees of the consequences of the financial crisis. It had been a long day. It was 9 p.m. and he was still in the air.
"We have never before seen this kind of a crisis," Winterkorn, 61, said at the conference. The German auto industry, he told his audience, must prepare itself for a "tough, prolonged dry spell." It would not be possible to avoid "difficult cuts" and "painful" measures, Winterkorn said.
Norbert Reithofer, the 52-year-old chief executive of BMW, is similarly baffled. He believes the company is "in the biggest crisis in its history." BMW has already cut more than 8,000 jobs this year. Production in its plants is shut down for several weeks at a time, a step that Volkswagen and Mercedes-Benz have also taken. But this will not be enough to offset the sharp decline in sales. In some markets, auto sales have not dropped by this much since the 1973 oil crisis.
[source]
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