Author: Alexander Detev
The German company „Bosch" is closing 670 jobs in Bulgaria, and will release practically its entire engineering team in „Sofia Tech Park". 400 employees will be released this year, and the other 270, who are still working on current projects - in 2027.
The main reason is that the Bulgarian engineers of „Bosch" are implementing projects mainly for the automotive industry in Germany, which has been in crisis for years. „The automotive industry is experiencing one of the most significant transformations in its history. Adapting to this new reality requires us to make strategic and sometimes difficult decisions," commented Dan Lazarescu, the director of „Bosch" for Bulgaria. And these difficult decisions have recently become an everyday occurrence for German industry.
German industry massively cuts jobs
Volkswagen recently announced that it plans to cut up to 100 thousand jobs in the coming years. It is not only the automotive concern that has such plans - a study by „Horvat" and „Handelsblatt" concluded that by 2030, 60% of industrial companies in Germany are planning layoffs. This trend has been going on for years and is getting stronger. Since 2019, the industry has lost 341,500 jobs, which represents a decline of just over 6%. Last year alone, 120,000 positions were cut.
Companies point to high personnel and energy costs as reasons for the layoffs. Other reasons include taxes and bureaucracy, which have long been a problem in Germany. BMW announced that it would spend 1 billion euros on restructuring, which will lead to the closure of 10,000 jobs and a 15% drop in car production. Mercedes-Benz will not pay its summer bonuses to employees in Germany this year.
“Companies are planning to cut more jobs,” the Munich-based “ifo” institute recently reported. Its employment barometer fell by 1.6 points in June to 92.3 points. This is one of the worst figures since the start of the coronavirus pandemic. “The labor market remains weak”, commented Klaus Wohlrabe, head of research at the institute.
Germany has benefited from globalization for years, but not anymore
According to “ifo”, the prospects for industry and trade are the worst. In these two sectors, the number of companies that intend to cut jobs exceeds by 18% the number of those that intend to open new jobs in the Federal Republic.
If German companies open new jobs, they prefer to do so abroad. However, the example of Bulgaria and “Bosch” shows that this is no longer the case for the territory of the European Union.
Germany is the third strongest export nation in the world after China and the United States, but it is precisely the problems with these two markets that are having a severe impact on it. On the one hand, China has been actively developing its automotive industry in recent years, thus competing with German manufacturers, on the other hand, the United States is pursuing an increasingly isolationist policy with the imposition of tariffs and other restrictions. “Germany was definitely among the winners of globalization. But in a world where the rules-based order is no longer guaranteed, a high degree of integration into the world economy can make you more vulnerable”, says Dirk Schumacher, chief economist at the state-owned development bank KfW to the “Wall Street Journal”.
The share of Chinese manufacturers is growing
In March, for example, the United States remained the most important export market for Germany, but exports there fell by 7.9% compared to the previous month and 21.4% compared to March 2025. Exports to China also fell by 1.8% in April. At the same time, exports to the EU increased by 3.4% and to the UK by 3.2%, leading to even a growth in exports from the Federal Republic.
The automotive industry, considered the backbone of the German economy, is suffering across Europe. In May, Volkswagen, Mercedes-Benz, Stellantis and Renault lost market share, although new car sales in Europe grew by 4% year-on-year. Meanwhile, the combined market share of BYD, Chery and other Chinese automakers exceeded 10% for the first time, the “Financial Times" reported.
When Germany sneezes, Bulgaria gets sick
While industry, and especially the automotive industry in Germany, is suffering, other sectors in Germany are growing. Over the past decade, for example, the construction sector has seen a growth of around 80,000 people, according to the Federal Employment Agency. In the information and communication technology sector, the growth amounted to around 70,000.
However, German industry is key not only to the economy of the Federal Republic, but also to that of Bulgaria. 30% of the largest investors in Bulgaria are German companies, and many of them are related to the production of automotive and aviation components, equipment and software. Therefore, the risks of a scenario similar to the one in “Bosch" are great.
According to Dirk Schumacher, the government in Berlin should work on three priorities - securing more sources of strategically important raw materials, stimulating start-ups and protecting against cheap Chinese imports. Surveys also show that employers want less bureaucracy, lower taxes and more freedom to hire and fire employees - measures that helped Germany get out of stagnation at the beginning of the century.