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Company closures in Germany hit a 20-year high in 2025
Around 188,000 companies in Germany ceased operations in 2025, a 10% annual increase that brought closures to their highest level in nearly 20 years. Local courts received 2,276 corporate insolvency filings in April 2026, up 7.1% year on year.
Company closures in Germany reached around 188,000 in 2025, the highest level in the past 20 years. This represented a 10% increase compared with the previous year.
The rise in insolvency filings continued in 2026. Local courts recorded insolvency filings from 2,276 companies in April 2026. The number of filings rose 7.1% year on year and also increased by 6.5% in the first quarter of the year.
Most closures were voluntary
Only 13% of the companies that ceased operations in 2025 filed for insolvency. Rising costs, competitive pressure and a shortage of skilled workers contributed to companies’ withdrawal from the market, while some businesses with good or average credit ratings also struggled to continue operating.
Creditreform spokesperson Patrick-Ludwig Hantzsch said the crisis had spread across the economy. While large corporate insolvencies attract greater public attention, many small and medium-sized businesses quietly left the market.
Manufacturing, construction and hospitality stood out
Company losses were concentrated particularly in traditional sectors. Some 11,000 companies in manufacturing, 24,000 in construction and 15,000 in hospitality ceased operations.
These figures represented increases of 10% in manufacturing, 12% in construction and 15% in hospitality compared with the previous year.
Crisis driven by multiple pressures
Insolvency expert Hans Joachim-Berner said current economic conditions had developed into a broad-based crisis. According to Berner, high energy prices, inflation limiting consumer spending and changes in interest rates had intensified pressure on companies.
Berner said the situation could not be reduced to a single cause. He said the COVID-19 pandemic, supply chain problems, the post-pandemic recovery, the war in Ukraine, the energy crisis, Iran and customs-related problems had accumulated over time, increasing the strain on companies’ financial resources.
Berner also said artificial intelligence was bringing rapid and fundamental changes to business models, adding that companies were facing significant pressure to transform.
Business community criticizes tax and bureaucratic burdens
Business circles in Germany cited high taxes, labor costs and bureaucratic burdens among the main causes of the wave of closures.
Karsten Schmidt, a concert organizer in Berlin, said high taxes had put pressure on his small business. Schmidt said he was considering moving to another European country where taxes and labor costs were lower, and called for a more favorable environment for businesses in Germany.
Access to credit became more difficult
The increase in corporate insolvencies also narrowed the supply of credit. In response to rising risks, banks began demanding more collateral, tightening lending conditions and examining applications in greater detail.
Companies facing a lack of orders and structural transformation consequently found it more difficult to obtain the investment needed to renew their business models. Automotive suppliers and energy companies were among the sectors particularly affected by changing credit conditions.
Although banking circles did not explicitly use the term “crisis,” the increase in systemic risk was reflected in lending conditions. Small and medium-sized businesses, which rely more heavily on bank loans, saw their room for maneuver narrow.
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