Germany’s industrial decline is taking a painful toll on communities that have long relied on domestic manufacturing titans for jobs, prosperity and a sense of a secure future.
Among the places affected by the downturn is Ludwigshafen, a company town of chemical giant BASF, which has shed thousands of jobs as it shifts its focus to China.
“The mood is definitely not good,” Sinischa Horvat, chairman of BASF’s works council, which represents staff interests, told AFP during a visit to the city of around 175,000.
“The whole market is so weak right now. When you look at the news, you hardly hear any positive messages.”
BASF is among Germany’s manufacturing heavyweights in sectors ranging from cars to steel and factory equipment that have cut back on their domestic markets.
They are struggling with rising energy costs, stiff competition from China and weak demand at a time when Europe’s largest economy has been mired in prolonged stagnation.
About 2,500 jobs have been cut since 2022 in Ludwigshafen, which is dominated by the sprawling chemical factories that stretch along the Rhine River, and more cuts are expected to come.
A recent decision to sell thousands of company-owned apartments, many occupied by current and former workers, has added to the concern.
“The sale of these apartments sends a signal to the city and the people who live here and, in some cases, work at BASF – BASF is reducing its operations,” Patrick Thiel, who lives in one of the apartments and works at the firm, told AFP.
“There is a growing concern that this will not stop at the apartments, but will also affect the main factory,” added the 29-year-old, who also ran as a candidate in the last local polls for the left-wing Die Linke party.
China’s push
Horvat said the presence of BASF staff on the properties helped create a “symbiosis” between the company and the community.
“It has fostered an understanding of chemistry and shaped the relationship with BASF in the city,” he said.
BASF – a supplier of basic inputs to the agriculture, automotive and pharmaceuticals sectors – says the proceeds will go to strengthen its core businesses, but admitted the sale had “raised uncertainty”.
However, a spokeswoman for the company insisted it would handle the sale responsibly, adding: “No one should have to fear losing their home.”
“We will continue to see ourselves as an integral part of the local community in the future,” she said.
Underscoring its commitment to Ludwigshafen, where the group has more than 30,000 employees – about a third of its global workforce – BASF has agreed to stop mandatory layoffs there until at least 2028 and continue to invest.
But as it cuts back at home, the world’s biggest chemical firm is investing heavily overseas, last month inaugurating a huge 8.7 billion euro ($10 billion) complex in China, its biggest investment project ever.
It insists that building its presence in China, the world’s largest chemical market, is essential.
Job losses
BASF is far from the only German company suffering.
Industrial companies cut 124,000 jobs last year, about double the figure in 2024, with particularly large losses found in the struggling auto sector, a study by consultancy EY showed.
Germany’s manufacturing sector shrank to a 19.5 percent share of the country’s economy in 2025, according to official figures – its lowest level for many years.
“The loss of industrial jobs in Germany has accelerated in the last two years,” Marcel Fratzscher, president of the economic institute DIW, told AFP.
“Companies that were once the pride of Germany are suffering.”
Areas that have already suffered industrial job losses see greater social problems and provide fertile ground for fringe parties such as the far-right Alternative for Germany (AfD) to gain support, experts warn.
However, Fratzscher said Germany had suffered economic turmoil before and urged politicians and companies to try to ensure the economy emerges stronger.
The current economic transformation should be seen “as an opportunity to move to sectors that have better margins, better jobs”, he said.
“The biggest mistake we can make is to try to cement the status quo, to keep all companies exactly the same. That would lead to much greater deindustrialization.”
