London, 3 November 2026 — EBM Newsdesk Analysis — By Amr Shabana
Another week, another blow to German industry.
Schaeffler, the Bavarian car parts giant, said on Tuesday that it will cut 3,460 jobs and close five sites in Europe by 2028. Around three-quarters of the losses will fall in Germany, with plants in Berlin, Dortmund and two other towns in western Germany shutting, along with a small site in Belgium. Jobs will also go in France and Slovakia.
The cuts amount to about 3% of Schaeffler’s 110,000-strong global workforce and are expected to save about €300m a year from 2030. Most of the cuts fall in production and research and development.
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Schaeffler’s explanation sums up the problems facing Germany’s car industry. The company said it was “responding to the persistently challenging environment in the automotive industry”.
In practice, that means three pressures at once. Chinese manufacturers are undercutting it on key products, from ball bearings to electric vehicle parts. Demand for combustion-engine components is falling, while the shift to electric cars is happening more slowly than expected. And German labour costs, which Schaeffler described as “above-average”, make it harder to compete.
It is the same story across the sector. Germany’s car industry has already lost more than 42,000 jobs, Volkswagen plans to cut about 120,000 roles by 2030, and Bosch announced 13,000 cuts last year. Europe’s efforts to protect its car industry with tariffs have not stopped the losses.
Suppliers Feel It First
Carmakers can pass on some of the pain. Suppliers cannot. When Volkswagen, BMW or Mercedes slow production or switch to cheaper Chinese parts, firms like Schaeffler, ZF and Continental feel it immediately.
That is why Germany’s car suppliers are trying to reinvent themselves for a future beyond cars. Schaeffler is no exception.
Robots and Rearmament
The company says some jobs will be created in “future-oriented fields”, including humanoid robotics and defence. Both make sense. A precision engineering group that makes bearings, motors and actuators has the skills that robot makers and arms manufacturers need.
Defence in particular is drawing in German industry. Rising military budgets have created a new generation of European defence billionaires, and Volkswagen has been weighing a move into defence too. For workers in Dortmund or Berlin, though, a future job at a robotics unit elsewhere is little comfort.
What I Think
Schaeffler’s cuts are not dramatic in size, but they are telling. This is a company that has spent years restructuring, and it is still cutting. The problem is no longer a weak quarter or a slow EV rollout. Germany’s car parts industry is too expensive to compete with China on the products it has always made.
Robots and defence may save parts of Schaeffler. They will not replace the hundreds of thousands of car jobs Germany is losing. Unless Berlin tackles energy and labour costs, more announcements like this are coming.
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