«Mercedes-Benz» has decided to consider suspending future investments in Germany and the possible closure of some of its factories. The move follows a failure to reach an agreement with trade unions on reducing labour-related costs. The «Financial Times» reports this, citing its sources.

To improve production efficiency and reduce costs, the company had proposed increasing employees’ weekly working hours from 35 to 40 without raising their wages. However, the parties failed to reach an agreement during four months of negotiations.

Michael Schiebe, head of «Mercedes-Benz»’s production division, said that the current cost structure does not allow the company to make investments in Germany. According to him, there is currently no clear prospect of reaching an agreement with the trade unions.

Britta Seeger, a member of the company’s management board, said that every possible measure would be taken to prevent the closure of «Mercedes-Benz» factories in Germany. However, she noted that under the current circumstances, the company was being forced to consider this option more seriously.

«Mercedes-Benz» operates a total of 12 factories in Germany. By the end of 2025, more than 107,000 people were employed by the company in the country, accounting for approximately 66 per cent of the entire group’s workforce.

In October 2026, the carmaker announced that its profits were expected to decline due to falling sales in China and accelerated its business restructuring measures.

According to the «Financial Times», Germany’s automotive industry is facing high production costs and growing competition in the European market from Chinese manufacturers of electric and hybrid vehicles.

According to a forecast by consulting firm «Roland Berger», cited by «Reuters», Germany’s automotive industry could lose at least 200,000 jobs by 2030 as competition from Chinese manufacturers intensifies.

Earlier, in September 2026, another major German carmaker, «Volkswagen», also approved a business restructuring plan. Under the plan, the company intends to lay off 50,000 employees, close four factories in Germany and reduce the number of car models it produces.