Big trouble for friendshoring: German firms slash investment in the US, to double down in China

by Inside China Business [2-6-2026].

Despite the weak dollar and high tariffs, industrial companies are dramatically reducing new investments in the United States.

Surveys of German companies reveal that the policies from Washington are simply too erratic for their executives to make even short-term forecasts, let alone multi-year budgeting decisions.

But their approach to China is radically different, and German firms' investments are the highest in years.

Access to China's deep supply chains and low energy costs are key drivers in attracting new CAPEX. But the demand side is just as compelling: The fastest-growing consumer markets in world history are in Asia, and consumers in Global Majority countries are far more valuable to goods-producing firms than the slow-growing economies of Europe and North America.

Closing scene, Qinghai.

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