A recent survey of German business leaders indicates that the US’s trade threats are not deterring investment from German industry. The study, conducted by consulting firm Horvath and reported in the Friday edition of Handelsblatt, polled 1,000 CEOs and executives to gain insights into strategic priorities for the next five years.
The survey reveals that German companies do not intend to increase their investments in the United States beyond current levels. This suggests that the economic pressure aimed at incentivizing foreign companies to relocate production to the US, a key objective of US President Donald Trump’s trade policy, is unlikely to materialize. Instead, the fluctuating US political climate appears to be viewed by German businesses as a source of uncertainty.
Furthermore, the domestic German market is not expected to benefit significantly. While German industrial companies plan to allocate an average of 37 percent of their investment budgets within Germany – still the highest share – this figure represents a two-percent point decrease compared to the survey conducted a year prior. Notably, over half of the companies anticipate reducing their workforce in Germany over the next five years.
However, German companies are signaling a shift in focus toward other regions. Plans are underway to expand operations in Eastern Europe, Southern Europe and India, with investments earmarked for production growth and job creation in these areas.