Saturday, 8 November 2025
Corporate insolvencies in Germany reached a new high in the first half of 2025, with suppliers to the automotive industry continuing to record the greatest pressure. According to the latest FINANCE Insolvenzreport by Falkensteg, 207 companies with annual revenues of at least €10 million filed for insolvency in H1 2025. This marks a 21 percent increase compared to the same period last year.
The automotive supply industry was again the hardest hit. Eighteen large suppliers filed for insolvency in the first quarter, followed by eleven in the second quarter. Electrical engineering firms recorded a similar number of cases in Q2, but analysts at Atradius caution that smaller Tier 3 and Tier 4 automotive suppliers remain especially vulnerable due to limited financial reserves and high dependency on manufacturers.
Overall, German courts recorded about 12,000 company insolvencies in H1 2025, an increase of between 9 and 12 percent year-on-year, depending on the reporting source. Atradius notes that liquidity pressures, delayed payments and tighter credit conditions are compounding challenges for the sector. Many suppliers still focus on combustion engine components and face substantial investment costs to adapt to electric mobility.
Trade and tariff uncertainty is adding further strain. While a baseline tariff agreement exists between the EU and the United States, uncertainty about future measures is prompting carmakers to consider shifting production to North America. Analysts warn that smaller suppliers will struggle to follow, which could result in a lasting reduction of capacity in Germany.
According to Atradius, credit insurers and lenders are responding by conducting more differentiated risk analyses, focusing not only on liquidity but also on how companies are positioning themselves strategically to navigate structural change.
Methodology note: From 2025, the definition of “major insolvency” in the Falkensteg report applies to companies with annual revenues of €10 million or more, compared with €20 million in previous years. This adjustment affects year-on-year comparisons.
