Boom in Corporate Collapses Across Western Europe: A Harsh Economic Reality
Corporate bankruptcies in Western Europe are spiking noticeably once more. - Business collapses in Western Europe rise once more
Here's the lowdown on the latest economic gloom in Western Europe: It's a bustling battleground for trade strife and turmoil, with an alarming spike in corporate implosions. Patrik-Ludwig Hantzsch, the big kahuna at Creditreform Economic Research, weighed in, "Three years of economic doldrums haven't spared Germany alone. Europe's in the thick of a weak economic atmosphere."
According to Hantzsch, heightened competition has triggered a "massive" rise in corporate bankruptcies across Western Europe. This surge isn't merely a delayed reaction to the COVID-19 crisis but a harsh new reality.
In 15 out of 17 Western European nations under the microscope, insolvencies skyrocketed. The exceptions? Denmark and the UK, where they dipped. The standout countries? Ireland, Greece, and the Netherlands saw staggering increases. Germany recorded a 22.5% surge, while France clocked in at 17.4%.
The construction industry was the hardest hit, with a 15.4% surge in insolvencies. As the credit agency explained, climbing construction costs, steep financing charges, and sagging demand have piled the economic pressure on this aching industry.
In most Central and Eastern European countries, insolvencies also went up. Creditreform noted a recent increase in Poland, Latvia, Slovenia, Lithuania, and Estonia, but Hungary's dramatic drop amid a prior spike in 2022 and 2023 muddied the overall picture.
The USA isn't immune to this financial freefall. Insolvencies shot up by 16.6%. Creditreform blames stubbornly high interest rates and sliding consumer spending for the squeeze on American businesses. However, U.S. figures remain below the pre-COVID heights of 2018 and 2019.
- Western Europe
- Creditreform
- Company insolvency
- Business insolvency
- Credit agency
- Germany
- Patrik-Ludwig Hantzsch
- COVID-19
- Neuss
- Eastern Europe
- Europe
- Hungary
Insider scoop? The insolvency surge in Western Europe is rooted in a perfect economic storm composed of trade squabbles, tariff hikes, and industry-wide structural shifts. Creditreform Economic Research and other sources outline the following key factors:
- Insolvencies in Western Europe have risen by a whopping 70% since 2021, signaling an increasingly precarious financial climate for businesses [1].
- In the first quarter of 2025, a record number of large companies (with turnovers of EUR 50 million or more) filed for insolvency, with Western Europe accounting for the majority of new cases. The sectors hardest hit were services, retail, and construction [2].
- Trade skirmishes and tariff escalations have driven up operational costs and crippled supply chains, leaving companies with a difficult choice: stockpile costly inventory or face bleak profit margins. Some industries have downsized or avoided stockpiling, adding strain to business finances [2][5].
- These economic woes are amplified by structural shifts in the market and uncertainty, raising the specter of a domino effect where supplier and subcontractor insolvencies spread the risk across sectors and countries [2].
- National data, like Austria's 21.9% surge in insolvencies in 2024, suggests this trend is far-reaching, impacting countries such as Germany, Ireland, Greece, and the Netherlands, as part of a broader regional pattern [3].
Bottom line? The rise in corporate implosions in these Western European countries is a reaction to the mounting economic challenges linked to escalating trade disputes, protectionist tariffs, industry weaknesses (especially in services and retail), and structural market mutations, all conspiring to stress corporate coffers and set off bankruptcies. [1][2][5]
- The surge in corporate insolvencies across Western Europe, as highlighted by Creditreform Economic Research, is primarily attributable to a perfect economic storm of trade disputes, tariff hikes, and industry-wide structural shifts.
- In 2025, a significant increase in large company insolvencies was observed in the first quarter, with Western Europe contributing substantially to the new cases, especially in the services, retail, and construction sectors.
- Rising operational costs due to trade skirmishes and tariff escalations, combined with the challenging choice between stockpiling costly inventory or facing slim profit margins, are intensifying the financial strains on businesses across Western Europe.
- The escalating trend of corporate insolvencies, such as Austria's 21.9% surge in 2024, is affecting various countries in Western Europe, including Germany, Ireland, Greece, and the Netherlands, indicating a broader regional pattern.
