German auto suppliers lose market share to China

Munich. German automotive suppliers have lost international market share to their emerging Chinese competitors over the past ten years. According to calculations by the management consultancy Strategy&, the global market share of German suppliers in 2024 was 23 percent, three percentage points less than ten years earlier. Chinese companies, however—which played no role at all in the global market 20 years ago—increased their share from 5 to 12 percent over the same period. Strategy& is owned by the international auditing firm PwC.

Suppliers are crucial to the competitiveness of the automotive industry, as they not only manufacture parts but also play a key role in innovations and developments. According to Strategy&, the losses of German suppliers are primarily due to the sales declines of European manufacturers, who are the most important customers.

German automakers have lost ground, especially in China, but manufacturers there also largely source their parts from Chinese suppliers. Global sales of the ten largest automakers stagnated last year, while automotive suppliers increased slightly from €1.14 trillion to €1.15 trillion, according to the analysis. However, Chinese companies in particular benefited from this.

According to the consultants, one reason for this development is that Chinese companies develop and bring new products to market much faster than German ones. According to the study, Chinese manufacturers have not only developed a technological lead in key technologies such as batteries and software, but also offer their customers significant price advantages.

But the study's authors are by no means pessimistic: They point out that the German automotive industry already overcame a severe crisis in the 1990s. However, in addition to accelerating development and production, they also recommend a fundamental rethink for domestic companies: no longer focusing on the constant improvement of existing products, as is their custom, but instead exploring new fields of technology. "The pressure is high," said Henning Rennert, one of the authors. "But the industry has proven in the past that it can not only overcome crises, but also thrive on them."

RND/dpa