According to a new Allensbach survey, domestic strategic options are largely exhausted

Energy problem: High costs are causing many companies to relocate (Image: pixabay.com, ColiN00B)

Ninety-four percent of German energy-intensive companies consider it likely that more companies in their sector will relocate from Germany, with more than half (56 percent) even considering it very likely. This is according to an Allensbach survey of board members and managing directors of energy-intensive companies, commissioned by the consultant FTI-Andersch.

Difficult Competition

Germany’s economic situation remains strained. One in three companies is reducing particularly energy-intensive products, and one in five is relocating individual production steps abroad or is currently preparing to do so. Many business and technological measures to safeguard competitiveness have already been implemented, it is said

According to the companies‘ assessment, this means that after optimizing efficiency, self-generated electricity, long-term contracts, and cost control, only a few strategic options remain domestically. „The reality is that most companies in the current situation have no other choice but to undertake significantly larger transformations,“ says Karsten Schulze, board member and partner at FTI-Andersch.

Debt Financing as a Challenge

More than half of energy-intensive companies (56 percent) report strong or very strong competitive pressure from non-European suppliers, who often benefit from lower energy prices, government subsidies, or less regulation. As a result, 91 percent of companies are investing in automation and digitalization, and two-thirds (66 percent) are relying on specialized engineering solutions

According to the survey, 20 percent of companies report difficulties accessing external financing. Where this is the case, 77 percent are postponing investments, and 47 percent have recently reduced their workforce or are planning to do so. Furthermore, 83 percent see their planning certainty as having deteriorated, the majority significantly. 43 percent of industrial companies are severely or very severely affected by increasing global protectionism.

Regardless of the current survey, 22 percent of companies in Germany plan to cut jobs due to the upcoming minimum wage increase, according to the ifo Institute. The minimum wage will rise to €13.90 on January 1, 2026. Furthermore, more than a quarter of them (28 percent) expect to reduce their investments. Half of the affected companies plan to raise prices. Respondents also cited declining profits and a challenging competitive environment.

Source: https://www.pressetext.com