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baykalov

baykalov

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German Energy Reprieve Too Little, Too Late to Save Factory Jobs

With gas prices down from record highs, Germany has seen a surge of optimism that the worst of the energy crisis has passed. But for the country’s biggest industrial producers, the long-term picture remains dismal.

Companies including BASF SE, Dow Inc. and Lanxess AG are poised to cut thousands of jobs and shift investment out of Germany because they don’t expect Berlin to reliably provide the energy they need at prices close to those they once paid for Russian pipeline gas.

“We are no longer competitive in Germany,” Lanxess Chief Executive Officer Matthias Zachert said at a recent conference organized by Die Welt newspaper. The Cologne-based chemical maker plans to maintain its production sites in North Rhine-Westphalia, “but our investments to grow further will go to more competitive locations like the US.”

Germany is in an all-out push to secure enough affordable energy to keep its industrial base from shrinking. Business confidence has risen in recent weeks after a patch of unseasonably warm weather and the early completion of a liquefied natural gas terminal helped push down prices and avoid possible rationing and blackouts.

The reprieve has some manufacturers breathing a sigh of relief: automotive giants Mercedes-Benz AG and Volkswagen AG were primarily concerned that fuel rationing would deal a blow to finely-calibrated supply chains.

But Germany hasn’t received direct Russian gas imports since September — a dramatic shift considering Moscow accounted for more than half of German gas imports before the invasion of Ukraine. With virtually no prospect of those imports resuming, the outlook for German chemical, glass and building-material companies, where gas and electricity can account for a third of costs, remains bleak.

Even after recent declines, German energy prices remain substantially higher than in rival manufacturing zones in the US and Asia.
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baykalov

baykalov

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With friends like the US who needs enemies!

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BERLIN, Feb 19 (Reuters) - The Ukraine war will have cost the German economy around 160 billion euros ($171 billion), or some 4% of its gross domestic output, in lost value creation by the end of the year, the head of the German Chambers of Industry and Commerce (DIHK) said.

That means GDP per capita in Europe's largest economy will be 2,000 euros lower it would otherwise have been, DIHK chief Peter Adrian told the "Rheinische Post".

Industry makes up a higher share of the economy in Germany than in many other countries, and the sector is for the most part energy-intensive, meaning German companies have been especially hard hit by a surge in energy prices, which last year hit record highs in Europe.

German industry is set to pay about 40% more for energy in 2023 than in 2021, before the crisis triggered by Russia's invasion of Ukraine on Feb. 24 last year, a study by Allianz Trade said last month.

"The growth outlook for 2023 and 2024 is therefore also lower than in many other countries," Adrian said, adding that was also the case last year.

Germany, which for decades relied on relatively cheap Russian pipeline gas, now has especially high energy prices compared with the United States that has its own natural gas reserves, while France has abundant nuclear power.

"The gas price is around three-five times higher than in the United States," he said, adding electricity was four times as expensive as in France.
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A

Abominable

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ACuriousPLAFan said:
"And to the Chinese - If you jump on the Putin train now, you're dumber than dirt, it would be like buying a ticket on the Titanic after you saw the movie."

https://twitter.com/i/web/status/1627352550490923009
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American regime is split into two camps right now: the anti-Russia camp and the anti-China camp. Whether you're Democrat or Republican doesn't matter, both parties have each. They both don't like Russia and China, but have differing opinions on which is the bigger evil.

The anti-Russian camp wants the Ukraine war to go on indefinitely and put the China threat on the back burner. Problem is this will allow China to continue growing as an economic and military power. If the Ukraine war goes on for 4-5 years and costs NATO trillions of dollars in resources and equipment they will be in an even worse position vis a vis China compared to today.

The anti-China camp wants a shift in focus from the Ukraine war so attention can be diverted back onto China. The anti-Russians don't want this as they know if the funding and weapons to Ukraine is cut off it'll be the end for the Ukraine and Putin would have achieved a massive victory.

They were all mostly anti-China until the Ukraine war kicked off, then they converted into anti-Russian overnight. There's been a gradual shift towards the anti-China camp.

Lindsey Graham is one of it's biggest supporters. Also that crazy British Liz Truss, who gave a batshit crazy speech in Tokyo on friday.

I'm convinced the recent "China spy balloon" episode was a coup attempt by the anti-China faction to shift attention away from Russia towards China.
 
9dashline

9dashline

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pmc

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baykalov said:
German Energy Reprieve Too Little, Too Late to Save Factory Jobs
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actually energy is least of German problem. They can always export more expensive products and services to recoup the cost of higher energy.
Germany problem is shortage of school teachers. how to integrate and educate such high immigrant intake. see the recent riots on New Year eve. They recently signed immigration pact of India. there is also problem with medical or pharma products that lead to such high excess deaths. which will even need even higher number of immigrants to compensate. since the country so much depended on foreigners it increase stress on transport infrastructure as foreigners will need more travel services. when all those things are happening inside Germany firms like MB are only going in direction making expensive products. time will come there will no cheap products available. so most population will need imports from cheaper locations.
now you add all the external obligations due to EU and US. I am not going into the human capital that will be lost due to Ukraine war. If Ukrainians leave Poland/Czech for Ukraine to fight war these countries will face more there own shortages.

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In total, 2,340 flights have been canceled at affected airlines, disrupting journeys for more than 295,000 passengers, according to Germany’s airport association ADV.
The Verdi union is demanding a raise of 10.5% for its members. Inflation stoked by high energy and food prices is eating into wages.
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