Forsa study on investment: More than half of the manufacturing sector has no plans to set up new production facilities in Germany for the time being / One in three companies with a turnover of 100 million euros or more is relocating or scaling back

Regardless of location, 67 per cent of German manufacturing companies stated that they had invested in expanding production capacity since the start of 2025 or had decided to do so over the coming twelve months. In the mechanical and plant engineering sector, the figure is as high as 76 per cent. In Germany specifically, 32 per cent have expanded existing production capacity, whilst a further 29 per cent have concrete plans to do so. Looking ahead to the next twelve months, 65 per cent expect the business situation to remain stable, 26 per cent expect an improvement – of whom six per cent expect a significant one – and nine per cent anticipate a deterioration.

• The results can be regarded as representative of companies in the automotive, mechanical and plant engineering sectors, as well as energy-intensive industries (chemicals, paper, ceramics and metals) with an annual turnover of 10 million euros or more
• 37 per cent of smaller companies with a turnover of less than 50 million euros expect to have more employees in Germany by mid-2027, whilst 34 per cent of larger companies expect a reduction
• 42 per cent of larger companies are restructuring or planning to do so; for smaller companies, the figure is nine per cent

Other key areas of investment among the surveyed companies include in-house energy generation or energy efficiency (59 per cent), securing or regionalising the supply chain (55 per cent), AI applications in production (46 per cent), and automation and robotics (43 per cent; for companies with an annual turnover of more than 100 million euros, the figure is 70 per cent). A quarter of companies (25 per cent) have prepared for defence sector contracts by obtaining certifications, acquiring equipment or hiring staff.

“The majority of German companies are investing,” says Christian Säuberlich, spokesperson for the Executive Board of FTI-Andersch and Country Leader of FTI Consulting in Germany, Austria and Switzerland (DACH). “However, the Forsa figures also show that a third are not investing in the expansion of production capacity. The majority do not expect the business situation to improve in the coming year.”

One in five companies is reducing capacity in Germany

Fifty-five per cent have neither established nor planned any entirely new production capacity in Germany; in the mechanical and plant engineering sector, this figure is as high as 57 per cent. In this sector, 44 per cent also have no plans to expand existing capacity.

At the same time, one in five companies (21 per cent) has reduced production capacity in Germany or decided to do so; in energy-intensive industries, the figure is one in three (33 per cent). Among larger companies with an annual turnover of 100 million euros or more, the proportion stands at 31 per cent, whilst for smaller companies with a turnover of less than 50 million euros, it is 18 per cent. Eleven per cent have closed entire production sites in Germany or decided to do so. Among larger companies, the figure is 30 per cent; in energy-intensive industries, it is 15 per cent.

“The conditions at production sites have been the subject of debate for years,” says Christian Säuberlich. “The Forsa figures make it clear that many companies are taking action or have already done so: Where a plant is no longer viable, even in the long term, capacity is being cut, relocated, sold off or the site closed down.”

Relocation abroad: cost advantages are more decisive than bureaucracy and infrastructure

In total, 17 per cent of companies have, since January 2025, relocated production stages, investments originally planned for Germany or central functions abroad, or have decided to do so. Among larger companies, the figure is 39 per cent. 31 per cent have relocated individual production stages or product lines abroad, or have decided to do so. In the energy-intensive sector, 20 per cent have implemented or decided on at least one of these overseas activities; among automotive suppliers, the figure is 16 per cent; and in mechanical and plant engineering, 11 per cent.

Among the companies undertaking relocation activities, 48 per cent have invested or intend to invest in Asia (excluding China), for example in India or South-East Asia; 44 per cent in Eastern Europe; 41 per cent in China; and 21 per cent in the USA (multiple responses permitted). When asked what factors influence the decision to relocate investments from Germany abroad, 83 per cent of these companies cite cost advantages in terms of energy and wages as a major or very major factor. This is followed by better economic prospects in the destination country (63 per cent), grants or subsidies (44 per cent) and tax advantages (42 per cent). Less bureaucracy and faster administrative processes have a major or very major influence for 31 per cent, whilst better infrastructure does so for 13 per cent.

“Relocating individual product lines or divisions does not mean abandoning the country,” says Christian Säuberlich. “On the contrary: most companies still want to maintain a presence in Germany. The economic situation has in many cases led to significantly greater regional diversification. And it enables them to relocate further divisions should local conditions deteriorate. Many companies have thus reduced their dependencies.”

Employment and restructuring: Smaller companies expect to take on more staff, whilst larger ones are more likely to downsize and restructure

By mid-2027, 30 per cent of companies expect to have more employees at their sites in Germany, whilst 51 per cent expect the number to remain the same. The increase in staff is taking place primarily in companies with a turnover of less than 50 million euros: 37 per cent of them expect to take on additional staff, compared with just nine per cent of larger companies with a turnover of 100 million euros or more. By contrast, 19 per cent of all companies surveyed expect to make redundancies, rising to 34 per cent among larger companies. “This is also linked to the fact that we are seeing significantly more investment in artificial intelligence, automation and robotics among companies with a turnover of more than 100 million euros,” says Christian Säuberlich. “Furthermore, in recent years, many have not made staff redundant due to the shortage of skilled workers, even though they were not working to full capacity. This is now leading to a significantly lower demand for new staff.”

At the same time, 42 per cent of larger companies have launched or are making concrete plans for a restructuring programme, compared with nine per cent of smaller companies. Twenty-four per cent of larger companies are acquiring companies or parts of companies, 21 per cent are selling business or product divisions, and 20 per cent are reallocating capital to higher-growth business areas. Two in three larger companies (64 per cent) are implementing or planning at least one of these restructuring measures, whilst one in three smaller companies (34 per cent) are doing so.

“The study shows that larger companies are significantly more active than smaller ones when it comes to staff cuts, capacity reductions, relocations and restructuring,” says Christian Säuberlich. “In our observation, those planning growth often do so in sectors with government-driven demand, including defence.”

About the German Economic Pulse 2026

For the German Economic Pulse 2026, the opinion research institute Forsa, on behalf of the management consultancy FTI-Andersch, conducted a telephone survey in the summer of 2026 of a total of 151 executives from German industrial companies: 37 companies from the automotive industry, 51 machinery and plant manufacturers, and 63 companies from the chemicals, paper, ceramics and metals sectors (energy-intensive industries).

The results can be regarded as representative of companies in the automotive, mechanical and plant engineering, and energy-intensive industries (chemicals, paper, ceramics and metals) with an annual turnover of 10 million euros or more. For the purposes of this press release, ‘larger companies’ are defined as those with an annual turnover of 100 million euros or more, whilst ‘smaller companies’ are those with an annual turnover of between 10 and less than 50 million euros.

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