Companies are bringing production back to Europe

Companies from Europe and the USA are increasingly relocating their production back home. This emerges from a study presented on Thursday by the consulting firm Capgemini. 47 percent of the large companies surveyed had initiated investments in order to relocate their production back to their home country or abroad; 72 percent had developed strategies for this or were already implementing them.

The study continues that companies want to invest a total of 3.4 trillion US dollars (3.2 trillion euros) in building new production capacities close to home over the next three years. More than half of this (two trillion US dollars) comes from Europe, 673 billion dollars (633 billion euros) from Germany alone. For the study, Capgemini surveyed 1,300 executives from large companies in Europe and the USA in February.

Against disruptions and delays

The companies cited their experience with delivery bottlenecks in recent years as the main reason for relocating production facilities. 70 percent of the managers surveyed cited wanting to better protect themselves against disruptions and delays in the supply chain as the most important factor. Most recently, attacks by the Houthi militia on ships in the Red Sea led to parts from Asia arriving late in Europe. The Tesla factory in Grünheide, Brandenburg, had to temporarily stop production as a result.

Government incentives and subsidies, which the USA in particular want to use to attract investments, played a role for 49 percent of those surveyed. Germany also recently approved high subsidies for new battery and chip factories.