The transformation process is often already quite advanced

The survey, completed at the end of 2025, reveals that not only have many German companies already begun to redirect their automotive business toward electric mobility - but that the majority are already well advanced. More than 20% of the companies surveyed reported that they are already fully oriented toward e-mobility, and another nearly 40% said that their transformation status is advanced. The researchers classify the majority of these companies as “pioneers or fast transformers”. The remaining companies are the “laggards or slow transformers”. Roughly one in four companies has already started the transformation process but, according to the companies themselves, considers this to be still in its infancy. One in eight companies surveyed has not yet begun the shift toward electric mobility.

The majority of companies have invested in future technologies

The survey also offers insights about which technology domains, internal combustion engine (ICE) or electric drives, the companies are investing in. In total, more than three-quarters reported that they had conducted innovation activities over the last three years. These were focused on electric mobility and digitalization. At the same time, however, more than one-third of the innovators mentioned innovation activities in combustion engine technology.  

What companies want: Support for innovation and lower electricity prices

Based on the coalition agreement of the current federal government, the companies were asked about their preferences for different policy measures to support the transformation toward electric mobility. The companies are in agreement when it comes to the use of limited financial resources: More than 80% of the companies surveyed want the state to invest more in education, research and innovation. Similarly, 80% also called for lower electricity prices, but across the board, not only in industry.

Least popular: Relaxing the CO₂ fleet limits

The least popular policy was a relaxation of the CO₂ emission performance standards. Around three-fifths of the companies are skeptical about this. In addition, more than 80% of companies would like to see accompanying policies introduced that support the transformation of the automotive industry.

Softening the CO₂ fleet limits could slow down the fast transformers

A closer look at the company data shows that especially fast transformers would prefer to retain the EU-wide phase-out of new combustion engine vehicles from 2035 – and these highly innovative companies are also strongly opposed to softening the CO₂ emission performance standards for new vehicles. Slow transformers, on the other hand, would prefer to see the speed of the transformation process reduced and find retaining the ICE sales ban less attractive. By watering down the phase-out of combustion engine vehicles, the German government is essentially championing slow transformers at the EU level at the expense of innovative fast transformers. In their strategy paper, the researchers describe the risk that the position taken by the German federal government could slow down the industry’s innovation dynamics. This would squander the German automotive industry’s chance to be among the leaders in the global innovation race toward electric mobility.

Credibility of policy measures is a key factor

The researchers identified the credibility of the policy mix for the transformation toward electric mobility as a decisive factor for companies’ willingness to invest. In recent years, the political will to support the transformation to electric mobility is perceived as having peaked at the opening of Tesla’s “Gigafactory” in Berlin-Brandenburg in March 2022. From the companies’ viewpoint, there was a sharp decline in the German government’s perceived political will to support the transformation of the automotive industry in November 2023, when the budget crisis resulted in abrupt cuts to e-mobility funding. Since then, credibility has been slow to recover and remains at a low level. According to the authors, this harbors the risk that the full potential of policy measures will not be unlocked and that companies will be hesitant about embracing the transformation.

Strategy paper analyzes the results and formulates recommendations for action

The research team published the results of the survey in a strategy paper, which analyzes the findings, puts them into context of current industrial and climate policies, and derives recommendations for action. 

Weakening existing phase-out targets would put those companies at a disadvantage that have already made early and extensive investments in electric mobility. Instead of frequent readjustments, the authors recommend stabilizing the existing policy mix and supplementing this with specific add-ons, in particular measures to boost demand for electric vehicles and reliable framework conditions for investments along the value chain.

“Especially now, when CO₂ fleet limits and the phase-out strategy for combustion engine technology are being discussed in Germany and at the EU level, Germany should not just listen to the appeals of slow transformers, but also take those companies seriously that have already invested in electric mobility,” says Prof. Karoline Rogge, who coordinates the project and is a professor at the University of Sussex as well as deputy head of the Policy and Society Department at Fraunhofer ISI. “Because it is precisely these companies that can bring Germany back to the forefront of the global innovation race and strengthen the international competitiveness of its automotive industry. Our findings show that repeatedly changing course only weakens planning certainty and Germany’s innovative strength in future technologies. The transformation of the German automotive industry will only succeed with credible and reliable political backing”.

More information about the company survey and the strategy paper

The results of the company survey are taken from a pilot study in the EMPOCI project funded by the European Research Council at the University of Sussex and conducted in cooperation with the Fraunhofer Institute for Systems and Innovation Research ISI. It is based on 74 telephone and online interviews with management executives of vehicle manufacturers, suppliers and other businesses from the automotive ecosystem. Data were collected between August and November 2025. Around two-thirds of the companies surveyed are suppliers, more than three-quarters are small and medium-sized enterprises (SMEs), and about half have their headquarters in Baden-Württemberg.

The strategy paper was the result of a collaboration among researchers from the University of Sussex, Fraunhofer ISI, the University of Oldenburg, the German Institute of Development and Sustainability IDOS, and the University of Vienna.