German corporate bankruptcies have reached a new record high. Amid the economic downturn, small and medium-sized enterprises (SMEs) are particularly under pressure. The number of insolvencies rose significantly in October, with the construction industry, restaurants, and logistics sectors being especially hard hit. In addition to this new record, high energy costs, consumer restraint, excessive bureaucracy, and political uncertainties are further exacerbating the economic crisis. Industry experts predict a turnaround will take at least two years. (welt: 14.11.25)
New Record High Shakes Entire Industries
In August, local courts recorded 1,979 company insolvencies. This represents an increase of over twelve percent compared to the previous year. The total amount of creditor claims also skyrocketed to €5.4 billion – more than double the figure from a year earlier. On average, there were 5.7 insolvencies per 10,000 companies. Logistics companies were particularly hard hit, followed by construction firms and restaurants.
In addition, there were 6,132 consumer insolvencies – an increase of over eight percent. This underscores the profound strain the ongoing crisis is placing on society as a whole. Burdened by rising commodity prices, financing hurdles, economic uncertainty, and high energy costs, many businesses are increasingly struggling. Reserves are dwindling while new orders are drying up.
Company bankruptcies reach record high
The number of company bankruptcies is expected to rise to 24,500 in 2025. This would represent a new record high since 2015 and illustrates the seriousness of the situation. By comparison, the figure was 21,812 in 2024. Analysts anticipate a further increase given the current circumstances, especially since the economic safety nets from the pandemic era have completely expired.
Added to this is the strain caused by international trade conflicts. These threaten supply chains and pose new challenges, particularly for export-oriented companies. Smaller businesses in the hospitality and construction sectors are also increasingly losing their resilience. Another wave of corporate insolvencies seems inevitable.
Structural problems are exacerbating the situation
Among the main causes are not only high energy costs, but also increasingly paralyzing bureaucracy. In many places, slow approval processes are preventing urgently needed investments. At the same time, consumers remain hesitant. Weak domestic demand is hitting retailers, tradespeople, and service providers particularly hard.
Some sectors are also struggling with a massive shortage of skilled workers, which weakens their competitiveness. Even well-positioned medium-sized companies are losing stability due to this combination of internal bottlenecks and external pressure. Many executives are leaving or seeking opportunities abroad.
Hope Not Before 2027
According to Allianz Trade, an improvement can only be expected in 2027. The insurer forecasts a decline in corporate insolvencies to around 23,500 cases – a decrease of four percent. This is based on economic stimulus from government stimulus measures and a hoped-for stabilization of the geopolitical situation.
However, this assumption remains fragile. Many businesses face ongoing planning uncertainty. As long as the general conditions do not fundamentally change, the risk of further bankruptcies remains high. Without investments in location attractiveness, energy supply, and tax simplification, a permanent loss of economic substance is imminent.