VW Predicts European Automakers Will Go Bankrupt Without Financial Help image

Volkswagen said that some European automakers will soon go bankrupt without government’s help.

Volkswagen Chief Financial Officer Hans Dieter Poetsch declared that the European crisis has affected the auto market so bad that some automakers on the continent will have no choice but to go bankrupt without financial assistance.

“It is unclear if all carmakers will survive without governmental help,” Poetsch said on the eve of the Paris auto show on Wednesday. “Carmakers in southern Europe that produce small cars will be especially affected.”

Gathered at the Paris Motor Show, French automaker executives also expressed their concerns regarding the companies’ future in Europe. PSA said that soon other automakers will adopt its plan to close factories and cut off jobs a great amount of jobs. Renault CEO Carlos Ghosn said that the company’s plan to increase sales this year is strongly under pressure and that no improvement will be seen next year.

Fiat CEO Sergio Marchionne, who is also the head of ACEA industry lobby group, urges the European automakers to quickly find a comprehensive plan to reduce overcapacity in the region, a plan which received Volkswagen’s and other German carmakers’ criticism and opposition.