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GERMANY TO INVEST BILLION-PLUS IN ENVIRONMENTAL TRUCKING
The German Ministry of Digital and Transportation is putting more than EUR one billion into climate-friendly transport vehicles. This additional money comes after the ministry received four times as many applications for support for projects in its 2022 round of funding compared compared with 2021.
"The market for emissions-free transport vehicles has begun to take off," said Digital and Transport Minister Volker Wissing in a statement. "The market is developing very dynamically, and there's great interest. That's shown by the interest in our support program Climate Friendly Transport Vehicles and Infrastructure. In the current round of funding we're putting some 7000 climate- friendly transport vehicles on the road and supporting over 1000 companies – and not just from the logistics sector."
By 2030, Germany wants to see 75 percent of all newly registered transport vehicles be emissions-free. 40 percent of the vehicles supported thus far are heavyweights of twelve tons or more. Some 3000 filling and charging points have also been funded. The call for applications for the new round of funding is planned for the third quarter of 2023.
"As the ministry said, this a dynamically expanding market," explains Germany Trade & Invest CEO Robert Hermann. "There are lots of market niches opening up in areas associated with Germany's transition to carbon neutrality, and international businesses should be aware of them. Germany's location in the center of Europe means that it is a natural hotspot for environmentally friendly logistics."
TSMC TO BUILD MULTI-BILLION-EURO CHIP FACTORY IN GERMANY
Taiwanese semiconductor manufacturer TSMC plans to construct a massive new production facility in the eastern German city of Dresden.
The volume of its Dresden expansion will be at least EUR 10 billion. The new plant for 300-millimeter semiconductors will be located in the heart of the electronics hub often known as "Silicon Saxony." The German government and the EU will reportedly offer major financial support for the project, pending EU approval.
The planned factory will have a monthly capacity of 40,000 wafers. Construction is scheduled to start in the second half of 2024, with the facility to go operational by the end of 2027. Bosch, Infineon and NXP are also participating in the project, with ten percent each.
The plant's products will be aimed primarily at the European and German automotive and industrial sectors, said TSMC. The project follows upon similar expansions by German chipmaker Infineon in Dresden and US giant Intel in Magdeburg, also in eastern Germany.
"With TSMC's investment, a further global player in the semiconductor industry is coming to Germany," said Minister for Economic Affairs and Climate Action Robert Habeck in a statement. "It shows that Germany is an attractive, competitive location, particularly for key technologies like microelectronics."
Germany Trade & Invest (GTAI), the German government agency for international business promotion, was involved in the initial consultations that led to the TSMC expansion.
"Among the many advantages of Germany as a chipmaking location are its European-leading automotive industry and the availability of clean forms of energy, which will become increasingly important to international companies in the years to come," says GTAI CEO Robert Hermann. "This new expansion is a fantastic contribution to Silicon Saxony and the German economy as a whole. It will surely stimulate further opportunities for international businesses in Europe's largest economy."
Ten of the 16 microchip plant projects in the European Union are located in Germany, as detailed by the GTAI overview. They include Intel’s massive EUR 38 billion megafabs in Magdeburg as well as TSMC’s new EUR 11 billion facility and Infineon’s EUR five billion expansion, both in the Dresden area. Bosch, Global Foundries, Vishay and X-Fab are also expanding in various parts of the country, while Wolfspeed is building a EUR 2.5 billion plant in the southwestern German town Ensdorf.
One crucial reason for all the activity, GTAI found, was state financial support, in particular under the European Union Chips Act. It aims to increase the bloc’s share in global chip production from its current 10 percent to at least 20 percent by 2030. Such support makes it feasible for the world’s largest semiconductor producers to expand to Germany and enjoy proximity to European and world-leading industries such as Germany’s automotive sector.
“The fact that Germany has established itself as the clear center of European microchips shows that the country remains a viable location for industrial production,” says Germany Trade & Invest CEO Robert Hermann. “Conversely, the existing and planned production of semiconductors increases the strength and resilience of value chains in Germany and makes the country an even more attractive business location for international companies.”
AI BOOM SPARKS GERMAN START-UP RECOVERY
Despite recent dips in financing, more and more young technology companies are being founded in Europe's largest economy. The recovery is being driven in part by the intense interest in artificial intelligence applications.
The numbers of new start-ups in Germany is back on the rise. That's the conclusion of a survey done by the Internet platform Startupdetector in association with Germany's Start-Up Association.
According to the study 1293 start-ups were founded in the first half of this year – a 16 percent increase over 2022. New start-ups in the German capital, Berlin, recorded a 40 percent increase, as did fledgling companies in Germany's second-largest city Hamburg.
One conspicuous growth sector is artificial intelligence. According to the industry initiative Applied-AI, the number of AI startups is up 67 percent year-on-year.
"The positive figures on start-ups in the area of artificial intelligence show that Germany as a business location and German entrepreneurs are well-positioned in the competition for the AI market," says Germany Trade & Invest artificial intelligence expert Asha-Maria Sharma. "Trustworthy artificial intelligence from Germany is a driver of innovation in the established economy as well and is part of a sovereign European ecosystem."
Another hot sector according to the Start-Up Association is tourism, where the number of newly founded companies in Germany is up 111 percent.
GERMAN WIND ENERGY STARTUP TAKES IN EUR 750 MILLION
Berlin renewable energy company Nextwind says it has taken in three-quarters of a billion euros in its latest round of financing.
The firm currently runs ten wind farms with a total capacity of 150 megawatts and wants to expand dramatically, doubling its output.
“The investment is a positive sign for the German market,” co-founder Lars Meyer told business newspaper Handelsblatt. “For us, it offers the chance to become one of the biggest green electricity producers in Germany.”
Nextwind specializes in “repowering,” re-equipping 10- to 15-year-old wind farms with newer, more efficient wind turbines. It’s something of a trend in Germany. In 2022, one quarter of the more than 550 turbines that went operational in the country were part of repowering projects.
GERMAN GOVERNMENT PUTS EXTRA EUR 30 BILLION INTO CLIMATE AND TRANSFORMATION FUND
Germany’s governing cabinet has approved a major top-up of its Climate and Transformation Fund, or KTF.
The funding influx will take the value of the fund to roughly EUR 212 billion from 2024 to 2027.
The KTF aims to accelerate Germany’s transition to a carbon-neutral economy. It funds initiatives in everything from climate protection measures and scaling up the hydrogen industry to investment in semiconductor production and expansion of rail infrastructure. The top-up now goes to the German parliament, the Bundestag, for ratification.
Other areas earmarked for support are building modernization, expanding electromobility and decarbonizing heavy industry in Germany. The enlargement of the fund will be financed from the European Union Emissions Trading System and the existing economic stability fund created to mitigate the effects of the coronavirus pandemic.
“With the KTF economic plan, we are encouraging innovations in Germany as a business location,” said German Finance Minister Christian Lindner in a statement. “We’re creating the foundations so that future opportunities can arise from decarbonization and digitalization. The transformation will be open to various technologies.”
BATTERY RECYCLER PLANS NINE-FIGURE EXPANSION IN GERMANY
US company Redwood Materials has acquired Bremerhaven firm Redux Recycling as a first step in a drive to become a major player on the European battery recycling market.
Redwood CEO Jeffrey Brian Straubel, who served for 15 years as chief technical officer at American electric carmaker Tesla, characterized the move as part of the company’s mission to create a closed-loop battery supply chain in Europe. Straubel told German business newspaper Handelsblatt that Redwood was planning to invest a nine-figure sum in Germany in the years to come.
The acquisition of Redux gives the US company a site with an annual processing capacity of 10,000 tons in Bremerhaven, a major North Sea port. The facility is capable of recycling batteries from devices like mobile phones and laptops and tools such as power drills, as well as electric vehicle and e-bike batteries, making so-called black mass which is then processed further in specialized facilities. It’s Redwood’s first site in Europe.
“Europe continues to be the fastest growing EV market globally, driven by automakers' commitments and strong government support to electrify,” said Redwood when announcing the deal. “This acquisition will provide us with a well-established EU presence to quickly expand operations, increase capacity for battery recycling, and work closely with already-established suppliers, customers and industry partners across Europe.”
“This move by Redwood will in the medium term strengthen the battery value chain in Germany,” says Germany Trade & Invest sustainability expert Robert Compton. “Battery recycling helps secure the critical raw materials essential for the future of the German automotive industry. This is excellent news for Bremerhaven, Germany and Europe in general.”
Germany Trade & Invest (GTAI) is the German government's international business promotion agency. It helps international companies establish subsidiaries in Germany and German companies do business abroad. It also generally promotes Germany as a business location.
