• Germany closing factories at home, opening them in China

    From ltlee1@21:1/5 to All on Wed Nov 27 15:55:55 2024
    "Asia Times examines here the key factors and the companies that are
    reshaping their operations abroad.

    High energy costs in Germany: The result of ideological policies
    Germany’s energy policies have driven industrial electricity prices to
    levels that are among the highest in the world, second only to the UK.
    ..
    Industrial energy consumption down by more than 16% in 2 years
    ..
    Energy supply in Germany: Increased import dependence
    ..
    Massive subsidies for renewables...
    This centrally planned system, in which the government steps in to pay renewable energy producers when wholesale prices fall, has placed a
    heavy burden on the state budget, leaving less financial room for other critical investments.
    ..
    The role of lost Russian gas and the Nord Stream pipelines in Germany’s industrial decline
    The cessation of Russian gas imports has had a profound impact on
    Germany’s energy landscape, disrupting its industrial base and driving
    up energy costs.
    ..
    Falling domestic investment in Germany
    Rising energy costs and regulatory challenges have led to a significant
    decline in domestic investment. Private gross fixed capital formation is
    about 10% below pre-covid levels.
    ..
    Germany’s biggest companies cutting jobs in Germany and investing in
    China
    ..
    Soaring German investment in China: Record levels
    Despite calls from German policymakers and the EU to reduce dependence
    on China, German companies continue to set record levels of investment
    in the country. German investment in China has reached unprecedented
    levels in recent years, driven mainly by the automotive and chemicals
    sectors.
    ..
    Expansion of EU greenfield investment led by Germany
    ..
    Localizing supply chains and mitigating geopolitical risks...
    German companies are responding by increasing direct production in
    China, which offers both cost advantages and reduced exposure to global
    supply chain disruptions.
    ..
    Reducing German exports to China through local production
    ..
    China’s unique advantages for German companies..."

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