I'm not sure only the German market was meant by OP.
VW has international sales, and OP's implication might've been that Germany has a national interest in VW being competitive.
> only the German market
Well yes, I of course meant the entire EU+UK market. Regardless besides US and a handful of other countries VW is hardly competing that much with any American car companies anywhere (besides Tesla).
American car makers are still struggling a lot more in relative market share terms (GM+Ford+Tesla barely had over 33% in 2024 in the US). While VW alone had 26% in EU/UK/EFTA (just German companies have 39% of the entire market there)