"Made For Germany" Is History: Covestro Caught In The Waves Of The Sell-Off
Submitted By Thomas Kolbe
Abu Dhabi’s state-owned energy giant ADNOC has acquired nearly all shares of German chemical powerhouse Covestro. Germany is gradually losing its strategic position in critical industrial sectors. The sell-off is accelerating.
Remember the big media spectacle “MADE FOR GERMANY” this past July? Chancellor Friedrich Merz staged a meeting with 61 corporate CEOs, proudly announcing supposed future investments of €631 billion.
Even then, given the ongoing capital flight from Germany, it was clear that the event was mainly a media stunt – a sad attempt to distract the public from the real state of the German industrial base.
Sell-Off Accelerates
Since that day, Germany’s industrial sell-off has not slowed – it has accelerated. Companies have already made their judgment: suffocating regulations, exploding compliance costs in the name of climate policy, and an administratively hostile environment have turned investments into a risk.
In short: industrial production is being systematically and willfully strangled by lawmakers.
Last week, German chemical giant Covestro grabbed the headlines. This time, it was Abu Dhabi’s ADNOC on a bargain hunt – Black Friday has become a daily routine.
At around €62 per share, for a total transaction value of €15 billion, ADNOC increased its stake to over 95% – effectively taking control of company policy.
Loss of Capital and Know-How
Capital gains will no longer flow to Germany but to Abu Dhabi. Strategic decisions about investment and location policy are now made by owners abroad.
This is especially critical for a company of clear strategic importance: Covestro’s high-performance plastics and polyurethanes are essential for Germany’s key industries – from automotive and machinery to construction and electrical engineering. Covestro is a central element of the industrial value chain, whose stability largely determines the future of the entire German industrial base.
About 40% of the 15,000 employees still work in Germany, many at the Leverkusen headquarters. But even Covestro has not escaped the general decline. Germany’s chemical industry now operates at just 71% capacity – a drop of more than 20% from the record year of 2018 – a sector now navigating increasingly rough waters.
Covestro has reported negative net earnings in recent years, while operating profit (EBIT) fell by more than 50% from 2023 to 2024, down to €87 million. Pressure from international competitors, high energy costs, and increasingly complex Brussels regulations have pushed the company to the limits of its competitiveness.
A Broader Trend
The trend of selling off Germany’s industrial crown jewels began with the sale of Augsburg-based robotics and automation specialist KUKA in 2016. At the time, China’s Midea Group acquired a majority stake for €4.6 billion.
Even then, the same spectacle played out: the new investor publicly promised jobs and location guarantees, but quickly shifted to a mode where strategic decisions were tied exclusively to return expectations and location quality.
There is simply no place for sentimental traditionalism or patriotic rhetoric in this world. Global industry moves forward – and no one outside Europe shares the passion for risky green policy experiments.
Dramatic Consequences
Covestro and KUKA are just two prominent examples of a secular trend. Year after year, Germany loses net direct investment. Last year alone, €64.5 billion flowed out – capital that is being invested elsewhere in new production capacity. Note: this is a net figure, which is expected to be even higher this year.
Germany’s economy is bleeding, while political leaders respond with half-hearted industrial subsidies – like the so-called “industrial electricity price” – and ever-new regulations. Many companies are likely to exit in anticipation of the cost tsunami from the CO₂ certificate market starting in 2027.
The U.S. Factor
Above all, the United States beckons as an alternative production base. The Trump administration has made it clear that it will use every lever – including tariff pressure – to advance reindustrialization. This includes deregulation of the energy sector, an end to costly renewable experiments, and an industrial policy that welcomes investors rather than driving them away.
Add to that promises from Arab states like Abu Dhabi and Saudi Arabia to invest trillions in U.S. production – concrete proof of Washington’s seriousness. “Made for USA” will become a major political and economic mantra in the years to come. The U.S. economy is currently growing at over 4%, accelerating global capital shifts.
The list of German companies moving to the U.S. is growing. Hamburg-based metal producer Aurubis, automotive groups Stellantis, and supplier Bosch are among firms planning to strengthen the North American economy with billions in investments.
No One Sacrifices the Green God
It would be too simplistic to blame this trend solely on U.S. trade policy. Long before Trump returned to the White House, it was clear that industrial production in Germany – and across the EU – had become unprofitable. As long as national policy enforces the Green Deal and its “green transformation,” nothing will change.
No one dares to sacrifice the Green God – the destructive CO₂ narrative driving economic collapse.
Half-hearted protests by Mittelstand associations, such as the Family Entrepreneurs, calling for broader political discourse including the Alternative for Germany – and their sharp political and media pushback – show that Germany still does not recognize the seriousness of the situation.
With each major corporation relocating abroad, the backbone of the German economy – the deeply integrated Mittelstand – is weakened. Even the public sector hiring half a million people cannot mask the fact that industry has cut hundreds of thousands of jobs and will continue to lose value in the coming years.
Celebrating the reintroduction of an EV subsidy as a major industrial policy step is, at its core, nothing more than a declaration of bankruptcy of eco-socialist policies that have propelled the country into a spiral of poverty.
