The German automotive industry, a cornerstone of the nation’s economy, is racing toward a future dominated by electromobility, digitization, and sustainability. Yet, this transformation comes with a steep human cost.
According to the recent Prognos study commissioned by the German Association of the Automotive Industry (VDA), released in October 2024, the transition to electric vehicles (EVs) could cost Germany up to 190,000 jobs by 2035 if current trends persist.
With 46,000 jobs already lost between 2019 and 2023, the main issue is clear: the electrification of drive-trains requires fewer workers than the hands-on production of combustion engines, threatening livelihoods across the industry. But this isn’t just a story of loss—it’s a clarion call to action. How can Germany reskill its workforce to thrive in this new automotive era?
Shrinking workforce needs
The Prognos study paints a dark picture. Electric drivetrains are simpler products to produce—fewer moving parts, less assembly, and a reduced need for traditional mechanical know-how. The report estimates that EV production requires about a third fewer employees than combustion engine manufacturing. But this isn’t a sudden crisis it’s a structural shift driven by the call for decarbonization coupled with technological advancement.
Of the close to 1 million people employed in the industry in 2023, many in mechanical engineering and metalworking roles are seeing their roles disappear. Meanwhile, fields like IT, electrical engineering, and software development are on the rise, reflecting the digital backbone of modern vehicles. Who is surprised?
The numbers are sobering. If the trajectory from 2019 to 2023 continues (which it will, in Europe at least), nearly a quarter of these projected losses have already occurred. VDA President Hildegard Müller frames it as a transformation, not a collapse—but the human impact is undeniable. Workers in traditional roles—think welders, machinists, and assembly line veterans—face an uncertain future unless proactive steps are taken. Germany’s automotive giants are investing heavily—€280 billion in R&D and €130 billion in plant upgrades between 2024 and 2028—but without a skilled and available workforce to match, these investments could falter.
Reskilling – a dirty word
The answer lies in reskilling, according to the EU Commission and groups such as the European Round Table (ERT). The VDA study highlights growth areas: automotive engineering, technical R&D, IT, and software development. These aren’t just niches; they’re the future of mobility, from designing EV batteries and battery management systems, to coding autonomous driving systems. The challenge is building the bridge between yesterday’s skills and today’s demands.
Companies like Volkswagen and Bosch could partner with vocational schools and universities to offer accelerated courses in electrical engineering. These programs should be hands-on, leveraging Germany’s robust apprenticeship model, and subsidized by government-industry collaboration to ease the financial burden on workers.
Rather than shedding workers, manufacturers should invest in internal retraining. Siemens, for instance, has successfully transitioned employees into digital roles through in-house learning. Automotive suppliers, currently employing around 270,000 people, could adopt similar models, turning metalworkers into technicians who can troubleshoot EV systems.
The VDA has called for a political framework to accompany this seismic shift, and they’re right. Tax incentives for companies that reskill, grants for workers pursuing new certifications, and regional job transition hubs would soften the blow. The Ruhr region is a good example; once a coal powerhouse, its shift to renewable energy jobs offers a blueprint worth copying. EU governments, and the EU Commission itself, must also address broader competitiveness issues—high energy costs and bureaucracy—that deter investment in reskilling initiatives. EU industry is dying rapidly. It is simply no longer competitive on the world stage.
Together we are better
Employers, educators, and policymakers must align. Industry giants can fund pilot programs, testing what works—perhaps a six-month boot-camp turning mechanics into battery technicians. Universities can offer micro-credentials, stacking short courses into qualifications that match employer needs. And governments must lead, not lag, ensuring funds flow to regions where auto jobs are clustered.
The automotive sector isn’t just about cars—it’s about identity, innovation, and economic stability. Losing 190,000 jobs in Germany alone risks more than livelihoods; it threatens global competitiveness. Yet, the Prognos study isn’t a final nail in the coffin. There’s life in the old boy yet. By reskilling its workforce, Germany, along with other EU nations can turn transformation into opportunity, ensuring workers don’t just survive the EV revolution but drive it.
