The German steel industry is issuing a stark warning ahead of a critical industry summit convened by Chancellor Scholz, demanding a fundamental shift in industrial policy to avert a potential collapse of domestic production. In a sharply worded commentary published in “Handelsblatt”, Gunnar Groebler, President of the Steel Association and Kerstin Maria Rippel, Managing Director, argue that without swift and decisive action, the sector’s transformation into a sustainable future is imperiled.
Central to their demands is a more assertive stance from Germany within the European Union regarding trade protection. The industry is calling for robust measures to combat “dumping imports” – goods sold at artificially low prices – and urging policymakers to structure the Carbon Border Adjustment Mechanism (CBAM), a levy on carbon-intensive imports, in a way that prevents an uneven playing field. Failure to do so, they state, necessitates a continuation of the current system of freely allocated emissions allowances.
Beyond trade, the commentary highlights the crippling impact of escalating energy costs. “The location is currently simply not competitive” the authors assert, emphasizing the urgent need for sustained reductions in grid fees, a reliable electricity price compensation scheme and the implementation of an industrial electricity price structure that fosters investment. Current energy prices are seen as a significant impediment to both modernization efforts and the maintenance of existing infrastructure.
The steel association is particularly alarmed by a steadily eroding industrial base. They report a monthly loss of tens of thousands of industrial jobs, a trend they characterize as a creeping crisis. The summit, therefore, represents a critical test of Germany’s commitment to safeguarding its industrial heartland. “This summit is a litmus test: Does Germany have the strength to secure its industrial base?” the authors ask, signaling a potential reckoning for the government’s industrial strategy and its impact on Germany’s economic future. The implied threat is that a failure to respond meaningfully could trigger further plant closures and a deepening loss of manufacturing capacity within the nation.