February 15, 2017

Industrial location Germany and Bavaria – development perspectives 2030

Industrial location Germany and Bavaria – development perspectives 2030

Bavaria enjoys a strong manufacturing basis. Its industrial products are wanted all over the world. Over the last decades, the State of Bavaria was able to keep its global market share despite increasing worldwide competition. But will this success continue? What are the key trends that will influence the future industrial development? In order to answer these questions the Bavarian Industry Association (vbw) assigned Prognos AG, an interdisciplinary think tank, to conduct the study Industrial location Germany and Bavaria – development perspectives 2030.

Global demand for industrial goods

According to the study the global demand for manufactured goods will continue to grow – although not as dynamically as in recent years. Between 2000 and 2014, the demand in industrial countries grew by an annual average of three percent, whereas the demand in emerging economies went up three times as much, by nine percent. By 2030, the vbw survey forecasts a yearly growth rate of 2.5 percent in developed countries and four percent in emerging markets.

Increasing demand in emerging markets

Especially in China, India, South Korea and Mexico, the study expects an enormous increase in demand. The market share of the German industry in these economies is currently between four percent in Mexico and almost ten percent in China, underlining the growth potential for German and Bavarian industrial enterprises in these countries. In Europe, on the other hand, the market share is much higher at currently 17 (UK) to 24 percent (Poland). In the near future, however, the growth rate of the European economies is expected to abate noticeably. The demand in the economy of the United States of America will increase at a medium rate with currently seven percent German market share.

Most potential for growth

In summary, China will be the most important foreign market for the German and Bavarian industry by 2030, replacing the United States as number one. With European countries like France, Italy, UK and Austria following. By 2030, the share of German manufacturing exports to emerging markets – excluding China – will rise from currently 16 to 25 percent.


Volker Leinweber

Volkswirtschaftliche Grundsatzfragen

Volker Leinweber