Wolfsburg is not a beauty, that is for sure. The city in North Germany is one of the country’s many “factory towns”, its skyline dominated by the massive Volkswagen plant in the centre, with its dark brownstone facade and high-rising furnace. The car giant is headquartered here, with the factory being the only reason Wolfsburg was even founded in 1938, as Volkswagen workers needed a place to live close to their work. Until today, the plant employs 70,000 of the city’s 130,000 inhabitants, with Wolfsburg’s residents granting their home town an affectionate nickname; “Autostadt” (“car city”). Everything in Wolfsburg revolves around Volkswagen and the plant, for now.
Volkswagen workers are on strike this week, in factories across Germany, including the Wolfsburg plant. In previous years, they would picket for higher wages or benefits, but this strike is different. Volkswagen has announced that it will close factories across Germany for the first time in the company’s history. Thousands of jobs are at risk. And it’s not just Volkswagen. In a country where 779,000 people are employed in the automotive industry, it is estimated 186,000 jobs are currently under threat, with more cuts to be announced, as the dire situation of giants like Volkswagen trickles down to their smaller suppliers. When Volkswagen announced layoffs and factory closures, their suppliers Bosch and ZF followed suit, each cutting thousands of jobs, most in factory towns like Wolfsburg raising questions about a system that seemed to work swimmingly for decades.
Germany has long been uniquely big on manufacturing. The sector made up 20% of Germany's GDP last year, much of it from car companies, while French and Spanish manufacturers barely accounted for 10%. Although firms like Volkswagen, Mercedes or BMW have long outsourced some production to South America and Asia, they have upheld their old German plants. Automotive workers in these factories know they are more expensive than their foreign counterparts, but unlike them, they produce cars “made in Germany”. To this day, every Mercedes AMG model motor made in Germany has the signature of the factory worker who produced it engraved on the front. Buying a car made in a German factory meant purchasing a certain quality, even if it came at a higher price.
That balance between quality and price is now off, though, car manufacturers say.
While producing anything in Germany has become more expensive due to rising energy costs, cheaper and more innovative competition from China has flooded the market. That is why, despite the quality, customers have simply stopped buying German-made cars, as they are too expensive and too old-fashioned. The workers making them have thus become redundant. It is not hard to guess who they are blaming.
Amongst the mainstream parties, the responsibility for the German car industry’s decline is disputed. Members of the recently broken apart left-wing Government blame Angela Merkel’s conservative administration, for relying too much on cheap Russian energy, causing the prices to shoot up after Russia’s invasion. The CDU/CSU disagree, decrying the chaotic governance style of current chancellor Olaf Scholz, saying he has failed to help the industry. But polls indicate many workers reject both narratives, frustrated with mainstream politics and turning to the fringes for solutions.
Founded in 2013, right-wing AfD was a fringe movement without much power for years, achieving 12% of the vote in 2017 and 10% in 2021. The party has been scandal-ridden, to say the least. The man often described as its secret leader, Björn Höcke, ironically a former history teacher, was recently convicted for using a prohibited Nazi phrase. A secret investigation last year revealed AfD officials had met privately to discuss mass-deportation plans, which would reportedly have included deporting German citizens with foreign parents. Some regional branches of AfD are so right-wing, they are being monitored by the secret service, and regarded as a threat to democracy.
But as the German car industry starts laying off workers, and the established parties are busy accusing each other of causing the recession, the AfD offers the laid off workers seductively simple solutions. Their election plan maps out heavily subsidising the automotive industry and buying gas from Russia again and that seems to work. At the recent election in the eastern state of Brandenburg, 46% of working class voters cast their ballot for AfD. The party now polls at almost 20% nationally which makes AfD Germany’s the second largest party, and they recently won a state election in Thuringia. Even conservative politicians have acknowledged that there is an obvious correlation between recent car worker layoffs and AfD’s success.
And let us be clear: this will get worse. There is consensus among economists that this is just the start of recession in Germany, and many more factory towns like Wolfsburg will face a massive job losses, and even worse, a loss of identity. Although an alliance of German CEOs have come out to say AfD would actually harm the economy if elected, they will further gain traction, unless the mainstream parties come up with a solution to save the car manufacturers. If they do not, Germany’s next government might well be AfD-led. Considering their extremist tendencies, that should worry us all.
Image: Wikimedia Commons/AndreasPraefcke
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