Germany’s automotive industry is currently facing significant challenges, with insolvencies becoming increasingly common. The latest casualty is AE Group, a major auto supplier with locations across the country.
The AE Group, headquartered in Gerstungen, Thuringia, has filed for insolvency under self-administration, as reported by Wirtschaftswoche. This affects approximately 1,200 employees across four locations: Gerstungen, Nentershausen (Hesse), Lübeck, and Strzelce Krajeńskie in Poland.
The local court in Meiningen appointed attorney Romy Metzger from the law firm SGP Schneider Geiwitz as the administrator, with Martin Mucha from Grub Brugger serving as the general representative. The company cited weak demand and rising energy costs as the reasons for its financial troubles. Despite the situation, AE Group aims for a complete restructuring.
AE Group, an aluminum foundry, produces various die-cast parts for automobiles, including gearbox housings, engine components, and battery casings for electric vehicles. The company, established in 1980, had projected a turnover of €150 million for 2024.
Rising insolvencies in the automotive supply sector
Insolvencies in the automotive supply sector are expected to increase in the coming months. Other sectors, such as construction and healthcare, are also experiencing difficulties. According to a recent analysis by the consulting firm Falkensteg, the number of large insolvencies in the first half of 2024 rose by 41% compared to the previous year.
“Rescuing companies from insolvency is becoming increasingly complex. High interest rates make acquiring insolvent companies more expensive or less attractive. Additionally, uncertain revenues due to the general economic situation deter potential investors,” explained Jonas Eckhardt, a partner at Falkensteg.
Eckhardt predicts that this trend will continue, potentially leading to more insolvencies, including those of a 208-year-old traditional company, a leading grill supplier, or even a German ski resort. “Many companies need to adapt to survive in the dynamic environment of international trade,” he added.
