Schade Deutschland, alles ist vorbei!

Germans, and Europeans, have made a habit of making their lives unnecessary difficult.

The title refers to the chart below, which recently went pretty viral on X. It shows industrial production in Germany. As the red arrow clearly indicates, the trend in German production is sharply downward. Since the 'peak' at the end of 2017, industrial production has fallen by more than 14%. This is hardly what you would expect from a 'manufacturing powerhouse.' Frankly, Germany has lost that status for some time now.

Decline

Of course, the question is what has caused Germany's decline as one of the world's leading manufacturing hubs. China is a significant reason: simply because Chinese exporters are more competitive than German ones.

Take the example of electric cars. While German car manufacturers focused on reinforcing their brand status, one Chinese electric car manufacturer after another emerged. The result is that China is now out-competing Volkswagen, BMW, and Mercedes, even on their own continent. If you've ever seen the inside of a Zeekr, you know it's serious value for money. It's no surprise that Europe, following the United States, wants to raise import tariffs on Chinese cars.

Enttäuschend

Politicians are quick to blame external factors like China for the shrinking German manufacturing industry. But this is also to cover up their incompetence. Germany's energy policy is disastrously poor. Not only because German manufacturing giants relied on cheap Russian gas, but also because of the bizarre decision to shut down nuclear plants, even when Germany had to cut off that same Russian gas. It was even more bizarre when Germany joined the list of countries at the always somewhat dubious World Economic Forum, promising the world to focus more on nuclear energy for climate change reasons.

Self-harm

And there's another critical reason why Germany is underperforming: increasingly stringent sustainability requirements at the expense of literally everything else. If there's one thing that has characterized Europe, Germany is certainly not the only one, with the Netherlands being another painful example; it's that it can shoot itself in the foot magnificently. The rules from 'Europe,' where it's hard to prove that the 'best' politicians end up there, are one-dimensional. Let's be clear that climate change and sustainability are important themes, but so are good housing (Germany is facing a construction problem due to excessive regulations, leaving the country with a housing shortage of over 700,000 units), employment (e.g., in manufacturing), aging, healthcare, and so on.

Of course, things can be reversed over time. Germany can implement more pro-business policies. Any policy that better balances various societal themes will help. But based on what I currently see, Europe is mainly focused on how it can shoot itself in the foot even more. That's a shame.