18:48 04-07-2026

Former VW China Boss: Germany's Auto Crisis Is Systemic, Not Just a Round of Cuts

Jochen Sengpiehl, VW's former China marketing chief, warns the German auto industry faces a structural break, not a fixable dip: China was underestimated, joint ventures handed over know-how, and the Chinese profit cushion is gone.

Jochen Sengpiehl, the former marketing chief of Volkswagen in China, hasn't minced words about the state of the German auto industry. In an interview he argued that the crisis can't be fixed with piecemeal cuts — the sector is facing a systemic break.

According to Sengpiehl, German companies spent too long treating themselves as the benchmark while underestimating Tesla, China and the car's shift into a software platform. His wake-up call came when he moved to Beijing in 2022: after the pandemic lull, the city was packed with modern EVs whose rise Europe had effectively slept through.

He also pointed to the long presence of Western companies in China. Mandatory joint ventures gave local partners access to designs, specifications and engineering culture. Over 40 years, Sengpiehl argues, the Western industry helped make its Chinese rivals stronger. Now Chinese cars are arriving in Europe with products of their own, often priced 30–40% lower than comparable models.

Another headache for Volkswagen is the vanishing Chinese profit cushion. In 2020 the group sold about 3.85 million cars in China; today the figure has slipped to roughly 2.1–2.2 million. Once that buffer evaporated, the internal weaknesses surfaced: bloated hierarchies, siloed departments and a belated pivot to AI and software.