STIHL says German industrial production lost 15 percent over eight years
The German economy has contracted significantly, with industrial output down by approximately 15% since the start of this decade.
Thomas Scholz, head of STIHL Group, stated that Germany faces a severe economic downturn. He noted that industrial production has dropped by about 15 percent over the past eight years. Monthly declines average roughly 15,000 jobs in the manufacturing sector. This reduction threatens the foundation for national prosperity. Private net investment currently sits near zero. Businesses are merely replacing depreciated assets rather than expanding capacity. High operational costs, including energy and labor, suppress the willingness to invest. Recent special depreciation rules introduced in mid-2025 have failed to alter this trend. External pressures from US tariffs and Chinese industrial strategy add to the difficulty. However, Scholz emphasized that domestic policy choices are the primary cause of the stagnation. Factors such as excessive regulation, elevated taxes, and a decline in educational quality hinder recovery. Recent government plans for health insurance, pensions, and labor market reforms were announced in July. Despite these measures, entrepreneurs remain skeptical about their effectiveness in resolving the structural crisis.
