“We must not jeopardise the capability and enhancement of our competitiveness – a joint achievement by politicians, businesses and trade unions over recent years. We should not forget that years ago Germany was seen as the ‘sick man of Europe.’ Eight years ago Germany was suffering with around 5 million unemployed. We must preserve our current competitive advantage, because our competitors are on the ball,” stressed Matthias Wissmann, President of the German Association of the Automotive Industry (VDA). He was speaking at the VDA’s New Year Reception to around 800 high-ranking guests including Dr Peter Ramsauer, the German Federal Minister of Transport, Frank-Walter Steinmeier, chairman of the SPD (Social Democrat) parliamentary group, Dr Jens Weidmann, President of the Deutsche Bundesbank who gave a speech, and numerous members of the German Bundestag, ministers from the federal states, and state secretaries. Ambassadors from all over the world were also among the guests.
At the New Year Reception the VDA’s Managing Board was represented by VDA Vice-presidents Dr Jürgen Geißinger of Schaeffler AG, Ulrich Schöpker of Schmitz Cargobull AG, and Dr Dieter Zetsche of Daimler AG, and by additional board members: Dr Daniel Böhmer of F.X. Meiller Fahrzeug- und Maschinenfabrik GmbH & Co. KG, Elmar Degenhart of Continental AG, Arndt G. Kirchhoff of Kirchhoff Automotive GmbH, Bernhard Mattes of Ford-Werke GmbH, Gertrud Moll-Möhrstedt of Akkumulatorenfabrik Moll GmbH & Co. KG, Matthias Müller of Porsche AG, Dr Stefan Sommer of ZF Friedrichshafen AG, Prof. Rupert Stadler of Audi AG, Prof. Martin Winterkorn of Volkswagen AG, and Dr Stefan Wolf of ElringKlinger AG.
“We, the automotive industry, need the European single market and want a strong and capable EU. The euro is our currency and will remain so. However, the Chancellor has – rightly – repeatedly been careful to demonstrate solidarity only on condition that the debt addiction in the crisis-ridden states be tackled and their competitiveness increased,” Wissmann said. The Bundesbank was right in always supporting strict monetary-policy rules, and the ECB had also sent out the correct signals, he emphasised.
“In the future the important thing will be to strengthen the notion of competition throughout Europe. A flourishing industry remains the basis for a healthy national economy. Creating better overall conditions for this – all over Europe – is a huge political challenge,” Wissmann explained. “If someone or other in Britain or on the Continent plays around with the idea of the UK pulling out of the EU, that is irresponsible. We need the UK – which is our most important export market – to remain a member of the EU in the future,” he underlined.
He went on to say he considered it correct that in Davos the German Chancellor had called for work to continue on strengthening European competitiveness: “There is no tenable reason to neglect this in an election year. It is also welcome that Brussels recognises the importance of Europe’s industry and we measure this by its actions supporting industry and the general economic-policy conditions.”
Wissmann also stated that Germany had taken years to bring its unemployment figures down. “The number of people in work in Germany has never before been as high as it is now. That is the social market economy in the best possible sense; it is socially-oriented and fair. Our companies are approaching major investment decisions in the face of growing competition,” Wissmann said, adding that this also had to be taken into account in tax policy. He took a critical view of proposals for a new version of a wealth tax or levy, and for increasing the burdens due to inheritance tax and income tax (which would be greatest on family businesses) in the next parliamentary session.
“Today’s investments are tomorrow’s jobs and social services. For this reason we need a smart tax policy and forward-looking promotion for research, which enhance industry’s drive for innovation and investment, instead of undermining the existence and earning power of industrial and family-run enterprises,” Wissmann stressed. “The year 2012 was a good automotive year for our industry – even if the obstacles have greatly increased,” the VDA president concluded. In some Western European countries, he said, demand for passenger cars had, however, fallen dramatically: by 20 per cent in Italy, by 14 per cent in France, and by 13 per cent in Spain. “In contrast, Germany decreased by only 3 per cent, so it has been a true rock of stability,” Wissmann underlined.
Furthermore, the German manufacturers had utilised the opportunity provided by globalisation much more than their competitors had, and were active all around the world. “Now more new cars from German group brands are produced abroad than at home. Three out of four passenger cars built in Germany are destined for export. This also benefits jobs in Germany. The greatest demand comes in particular from the growth markets in China, Russia and the USA,” Wissmann said.
Germany is an exporting country. Wissmann emphasised, “The German foreign trade surplus is recognised world-wide as a strength of the German economy. So it is all the more understandable when some in the EU complain about our export surpluses. It would be better if everyone were to improve their own competitiveness. The principle must apply, also in Europe, that we orient ourselves on the strong, not on the weak.”
Wissmann added that in 2012 the German automotive industry pushed up its world-wide sales to around 360 billion euro (cf. 351 billion euro in 2011). The number of (regular) employees in Germany alone came to 747,600, thus exceeding the previous year’s figure by nearly 17,000. “To make it absolutely clear: our basis is Germany. Our roots are here and will remain here. But one reason we are so successful is that we have a world-wide presence,” Wissmann underscored. The global passenger car market would expand again in 2013, he said. The growth would continue to occur mainly in the USA and China. However, automotive business in Western Europe would still be difficult. “We expect a world market volume of about 70 million passenger cars, and want to maintain our high share of that and expand it wherever possible,” Wissmann stated. He also predicted that 2013 would be a year of demanding work for the German automotive industry.