The association had reportedly been struggling to stay afloat given the stagnation in the countrys automotive sector

A German association bringing together companies linked to electric car production has filed for bankruptcy, the newspaper Die Welt reported on Sunday, citing court data. The organization represents a total of 450 companies from various parts of the world, including Mitsubishi and Kia, and acts as a lobbying group for them.

Founded 16 years ago, the German Federal eMobility Association (BEM) describes itself as a network of stakeholders along the entire electric car value chain and claims it is "actively driving the transition to a sustainable mobility and energy system based on renewable energy."

According to Die Welt, its members have a turnover of $114 billion and employ around a million people in total. It also reportedly has its own parliamentary advisory board.

Now, the "struggling" association has been assigned a provisional insolvency administrator by the Berlin-Charlottenburg insolvency court, the daily reported. It did not elaborate on the reasons that prompted the association to take this step. A BEM board member, Markus Emmert, declined to comment on the matter in response to a request by Die Welt.

Germany's automotive sector has long been mired in stagnation. In March, Bosch, the world's largest automotive supplier by revenue, announced additional job cuts potentially affecting thousands of employees.

Bosch CEO Stefan Hartung attributed the decision to the sluggish global economy, the stagnating automotive sector, as well as increasing competition from China. The industry has also been seeing a slower than expected transition to electric vehicles, according to Hartung.

Shutdowns and bankruptcies have also been affecting major German car manufacturers. In January, Reuters reported that Chinese car giants were eyeing Volkswagen factories in Germany that had been slated for closure.

The previous government led by former Chancellor Olaf Scholz set a goal of having 15 million fully electric cars on Germany's roads by 2030. However, according to the Federal Motor Transport Authority, as of January 1, only 1.6 million such vehicles were registered, accounting for just 3.3% of the nation's passenger car fleet. Electric car sales collapsed after Scholz's cabinet decided to end government subsidies for EV purchases following the budget crisis in 2023.

Earlier this year, Handelsblatt Research Institute (HRI) warned that the German economy is on track for its longest post-war recession. A third consecutive year of contraction is projected for 2025.

(RT.com)