The German government has decided to bring its ailing automotive industry on track. It has decided to add a sum of $3.56 billion, that equates to 3 billion euros, to its automotive market. This would take Berlin’s total financial support to a sum of 5 billion euros.
The decision on this subject was taken after concluding a meeting between Chancellor Angela Merkel and many leaders of car industries and labor unions. IG Metall, the largest labor union in Germany also formed a part of the meeting.
Attempt to Secure Jobs
The announcement to invest a stipulated sum is made to ensure job security in the automotive industry that is facing a tough time due to the Covid-19 pandemic. The Economy minister Peter Altamaier has said that the automotive industry in Germany has got affected due to the Covid-19.
He added that it has led to the loss of hundreds of thousands of jobs. The aid is sufficient to bring a long term structural change in the automotive sector. And it will lead to a boom in the sales in the industry which witnessed a decline in its revenue in the first half of 2020 due to the coronavirus pandemic.
Subsidies for Electric Cars
Angel Merkel’s spokesperson, Steffan Seibert has added that the financial package is aimed at providing subsidies for electric cars. And the stimulus package will also give a boost to auto parts makers. According to Seibert, Germany will also infuse 1 billion euros to given an extension to its subsidy for electric vehicles till 2025.
According to him, the step has been taken by keeping in mind the rising popularity of electric cars in the coming times. In addition to bringing transformation at a strategic level, it will also help to increase the cooperation between the federal, state, and regional levels.
IG metal has appreciated the intention of the government to include a stimulus package for providing subsidies for electric vehicles. Hildegard Müller, the president of the Association of the Automotive Industry (VDA) has expressed that this step will help to save many jobs of suppliers.
A Strong Message for Other Governments
This measure has given a strong message for other governments to take appropriate measures to revive their automotive industry. Due to the coronavirus pandemic, the demand for luxury vehicles has declined as people face a financial crisis that is preventing them from buying new cars.
Hence, they are focusing on buying old cars by carrying out the verification of details of cars on car verification sites. The online platform, checkcardna.com, is receiving a lot of traffic as more buyers are visiting the online platform to examine car details before buying it.
