It’s a special day for Siemens, says the boss, and you can tell that by the fact that the board is at the front here. And of course a special day for Germany, which you can probably tell from the fact that the Federal Chancellor will also be coming to Erlangen later on. When a company like Siemens invests a billion euros in Germany, then that’s not a bad time these days. “We don’t think we’re the wrong-way drivers,” says Roland Busch, head of the Siemens technology group. So you see yourself rather on the right side of the highway.
It’s only been a month since the Munich-based technology group announced an ambitious billion-euro plan for future investments. At that time it was about two billion euros that should go to new high-tech factories in Asia, Europe and the USA. Known so far: The construction of a new high-tech factory in Singapore for 200 million euros, from which the growing markets in Southeast Asia are to be served. And another 140 million euros for the Siemens plant in Chengdu, China. And at the time, many asked themselves: Nice, but where is the rest of the two billion euros going?
When companies announce something big, but then only communicate a small part of it, it doesn’t just spark speculation. Then you can also assume that they are pursuing a fairly well-timed dramaturgy here.
Like now at Siemens.
And so they are here on Thursday afternoon on the premises of the Siemens plant in Erlangen and are announcing great things. One billion euros for Germany, 500 million euros of which are to go to a new campus for development and high-tech in Erlangen. Siemens relies on innovation in Germany, says Busch, on industrial automation and digitization. Highly automated factories where people and machines work hand in hand.
Silicon Valley in Franconia – that should be the goal
A kind of “foundation stone for the industrial metaverse” is now to come from Nuremberg, says Busch, i.e. for the business with virtual representations of the real world in industrial production. And the group? Might become some sort of new meta (Facebook) in the factories; Silicon Valley in Franconia. “We’re revolutionizing the way we produce,” says the Siemens boss. Another revolution from Bavaria, more than 100 years after the last one.
It goes well with this Erlangen lunchtime that on the same day the German Foreign Ministry Annalena Baerbock (Greens) is sitting in Berlin and announcing a new China strategy. Because in the end it’s somehow about making yourself more independent from China without leaving China. And above all: without alienating China and its leadership. Busch speaks this Thursday of “finding balance” – reducing dependencies, taking opportunities and profits. If everything were that easy.
Roland Busch is CEO of Siemens AG.
(Photo: Sven Hoppe/dpa)
In view of the increasing geopolitical tensions with China and the question of how things will continue with Taiwan in particular and with relations with Beijing in general, Siemens is also becoming a kind of test case for German industry: How do you get the right dose of China? What is too much, what is not enough China? It’s not as if Siemens wants to completely give up the billion dollar market – on the contrary. Give up the China business? Better not. Instead: distribute risks, you never know when and where the next major conflict in this world will take place. If you want to invest two billion euros in new plants and half of them stay in Germany, then that is also a statement.
And a sign against the threat of de-industrialization in a country that believed for years that globalization would continue like this – and that everything that was invested abroad would automatically be good for Germany as a business location. If you like, also a statement against companies that have no problem investing ten billion euros in China even in these times. Against the chemical group BASF and its very China-affine boss Martin Brudermüller, for example. “Many companies currently prefer to invest abroad,” said Busch. Siemens, on the other hand, is investing in Germany. You wouldn’t offend the Siemens boss if you interpreted it like this: We at Siemens do things differently, and that’s a good thing.
Siemens believes “in Germany’s innovative strength and inventive spirit”
Of course, Germany is currently anything but a dream for prospective investors. Complicated bureaucracy, rising energy prices and a lack of well-trained specialists. The Siemens boss knows that too. Why is he still doing it? “Because there are established, successful ecosystems here,” he says. “Auto, chemical, pharmaceutical, and very strong medium-sized companies”. And then comes one of those rhetorical figures who want to convince by simply repeating what has been said: “We invest in Germany because we believe in Germany’s innovative strength and inventive spirit. We invest in Germany because we believe in the people in this country believe.”
Others also invest in these weeks and months, but they may invest primarily because of the large sums that flow to them. The US chip manufacturer Intel receives around ten billion euros in state subsidies for its chip factory in Magdeburg and is thus investing a total of more than 30 billion euros. Tax money of ten billion euros for a US company to produce semiconductors in Saxony-Anhalt – this is by no means undisputed. Proponents argue: Europe is dependent on Asia for semiconductors and should therefore become more independent. But because the production of chips in Europe tends to be more expensive in comparison, it doesn’t work without subsidies.
Because that is the case, EU states should be able to support the construction of chip factories with billions in aid. The so-called “Chips Act” provides for around 43 billion euros with which the semiconductor industry in the EU can be promoted. The new Infineon plant in Dresden is also funded with public funds – this is a government grant of around one billion euros.
Siemens, which is important to Busch, does not receive any subsidies.