May 24, 2024

Why do many German companies prefer to invest there?


Better location? Mercedes battery factory in Alabama
Photo: EPA

The United States is seen as generally strong, dynamic, and “pro-business,” in contrast to Germany. No wonder many German companies prefer to invest in America.

DrGerman corporate bosses are increasingly directing investments to the United States. Last year, they invested more money in American projects than ever before. A study conducted by the German-American Chamber of Commerce among German branches in the United States of America revealed that 95% of the participating companies want to expand their investments during the next three years. Nearly three-quarters of them plan to expand their workforce in the United States this year.

The preference for the United States of America has several reasons. China, one of the most important investment and sales locations for the German economy, has become less attractive. Growth rates shrink as the country continues to generate local competition and close markets. There are also geopolitically motivated constraints: the West, primarily the United States, wants to prevent China from developing into an invincible hegemon using Western technology. Therefore, the United States urges not to hand over high-tech semiconductors and special production technology to China.

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