German Auto Industry Sentiment Hits Lowest Point Since Pandemic

Weak demand, economic challenges, and industry transformation are driving pessimism, though export expectations show slight improvement.

The Ifo Institute's industry index for the German auto sector dropped 3.5 points in November, reaching -32.1, the lowest level since the height of the COVID-19 pandemic.
A significant decline in demand has left companies unable to fully utilize their production capacities as backlogged orders from the pandemic era are now fulfilled.
The industry faces compounded challenges, including structural transformation, heightened competition, and a weak economic environment.
Hiring activity in the sector has slowed, with some companies considering workforce reductions due to ongoing difficulties.
Export expectations improved by 12.1 points, benefiting from a stronger dollar, though the indicator remains in negative territory at -19.2.