Mercedes-Benz is weighing the potential closure of two domestic production facilities in Germany after executive leadership declared local manufacturing costs uncompetitive by international standards. The automaker stated that high labor wages in its home country severely hamper productivity and cost structures, putting plants at risk despite the corporate desire to preserve local jobs.
Mercedes-Benz Weighs Plant Closures Amid High Costs
–>Sindelfingen Warning Delivered to Workers
The luxury automaker needs significant framework adjustments to maintain its domestic footprint. According to an official company statement sent via email to Reuters on September 25, 2026, Mercedes-Benz wants to preserve its factories and workforce in Germany, but doing so requires framework conditions that actively boost local productivity.
Michael Schiebe, head of production at Mercedes, detailed the gravity of the situation during a September 21, 2026, address to workers at the company’s 111-year-old facility in Sindelfingen. Schiebe informed employees that closures will happen unless production costs drop swiftly.
“Our primary goal is to preserve all our locations in Germany,” Schiebe told the assembled workforce, pointing to the necessity of mutual commitment toward cost-cutting measures. “If we are not able to do this, we have to close one German assembly plant and one German engine component plant.”
Silence on Specific Targets Stirs Tension
Management has not yet publicly identified which specific manufacturing or component sites face closure.
Labor Unions Vow Resolute Resistance
A spokesperson for the general works council, the central employee representation body for Mercedes, rejected the ultimatum outright.
“Threatening plant closures is not a way to shape the future,” the spokesperson said. “Anyone who uses such threats must be prepared to face our resolute resistance.”
The labor representative added that any management belief in coercing employees through concessions-or-closure ultimatums would fail, stating that the stance of the workforce leadership remains firmly opposed.
Structural Pressures on European Automakers
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