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Economy / Jobs

Chart: In Germany’s smaller cities, the car industry is thriving

In the age of high tech clusters and the knowledge economy, it seems slightly odd to think that anyone in the world of the rich should still earn their crust from building something as old-school as cars. In Germany, though, the manufacturing sector is seeing growth again after a rocky ten years – thanks mostly, it seems, to growing exports of cars to the emerging world.

This chart shows the change in the size of the manufacturing workforce each year in three of the country’s big manufacturing centres.

Annual changes (%) in industry employment. Source: CityMetric Intelligence.

During the financial crisis, both Stuttgart and Wolfsburg saw significant dips in manufacturing employment – but both have now stabilised. Despite the crisis, the automotive sector still employs more people in Stuttgart,  city of 600,000 in Germany’s south west, than any other sector. The Saxon city of Wolfsburg is smaller, with a population of just 120,000 – but in 2013, the automotive industry accounted for some 60 per cent of its GDP.

That sector is doing even better in Ingolstadt, a Munich satellite of 130,000. There the car industry was largely untouched by the global crash, and has seen consistent 1 or 2 per cent annual employment growth over the past six years. This may well be because of the success of its Audi plant: in the single year from 2011 to 2012, the company’s exports to the Asia-Pacific grew by 35.3 per cent, forcing it to buy another production site in the city to keep up with demand.

The continuing demand is a mark of the international strength of the “Made in Germany” brand, especially in China. Most German car manufacturers today get about two-thirds of their business from exports.

As far as some observers are concerned, in fact, Audi might have been a little bit too successful in China. This month, a Chinese economic agency announced that the manufacturer, along with American company Chrysler, will be fined up to 10 per cent of their annual Chinese profits for “monopolistic” practices. Oops.
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