Mercedes CEO: The German Economy Is Being Severely Hampered By High Labor Costs

Mercedes boss Ola Källenius has issued a stark warning about Germany’s economic trajectory, stressing that years of stagnation are fueling a political shift to the far right.

In an interview with Der Spiegel magazine, Schelenius claimed that Europe’s largest economy has been moving in the wrong direction “for about 10 to 15 years.”

He warned that if this trend is not reversed, “then populists from the right will come, and they have no solutions for anything.”

The Swedish-born CEO blamed much of the country’s problems on a declining work ethic, comparing Germany’s current competitive stance to a national football team struggling with results.

Shelenius said that it was “like saying before the World Cup that we are training enough, even though everyone else is training twice as much.”

He pointed out that Germany now faces some of the highest labor costs in the world. While superior productivity used to offset those costs, he said that was no longer the case.

“We don’t want Asian working conditions in Germany, but we have to get back to a direction where entrepreneurship and investment in Germany pay off in terms of energy, taxes, and labor costs,” the Mercedes boss said. Otherwise, he warned, capital will flow elsewhere.

In an interview published over the weekend, Schelenius also weighed in on the current political debate about whether the legal right to part-time work should be abolished in Germany.

Defending the right to work part-time for reasons such as “raising children or providing care,” Schelenius said the general population must increase the total number of hours worked; otherwise, “our unique productivity engine will grind to a halt even further.”

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