Mercedes-Benz is putting any new investments in its German manufacturing plants on hold as it looks to reduce production costs and deal with rising pressure on its domestic operations.
The company is also exploring possible site closures, highlighting the growing challenges facing Germany’s automotive industry.
The decision follows disagreements between management, works council members and union representatives over proposed reductions in labour costs. Production chief Michael Schiebe confirmed that the company had jointly decided to suspend all further investments at its German locations.
Mercedes is not alone in facing these pressures. Volkswagen has already begun its largest restructuring programme, while supplier Schaeffler recently announced plans to cut 3,460 jobs and close five European sites, including four in Germany. Weak demand for combustion-engine vehicles was cited as one of the reasons behind the move.
Germany’s high manufacturing costs and changing market conditions are putting increasing pressure on its car industry. Mercedes’ latest decision adds to concerns about the future of jobs and production facilities in the country.
Source: Reuters
