German industry seeks fresh start in challenging times
Nadine Mena Michollek
2 hours ago

Hanover industrial trade fair takes place in a year of political upheaval, the Germany economy in recession, and US threats to global trade rules. But perhaps that's precisely why it's so important this time. 

More than 4,000 exhibitors are expected to showcase their innovations at what is billed as the world's largest industrial trade fair, with visitors from approximately 150 countries expected.

As in previous years, the fair is a must on the calendar especially of small and medium-sized companies (SMEs) from Germany and elsewhere, who are aiming to present their latest innovations — with the main focus this year being on robotics, mechanical engineering, power-train technology, and energy production.

Held in difficult economic times, the fair in the capital of the German regional state of Lower Saxony wants to "promote optimism," says Jochen Köckler, CEO of the fair organizers, Deutsche Messe AG.

"We want to provide a platform where politics and business can exchange ideas to discuss the framework conditions necessary for success," he told DW, with the main thrust being on building "trust in investments" and, above all, to "convey a sense of optimism."

This year's so-called partner country at the fair is Canada. Although the decision was made two years ago, the title has come to be particularly timely given the North American's fierce trade spat with the US administration of Donald Trump.

Just recently, Washington has imposed higher import duties on Canadian goods in a trade war that is also affecting the European Union.

"Given the geopolitical tensions, we are especially pleased that a country like Canada is the partner country this year," Wolfgang Weber, CEO of the German Electrical and Digital Industry Association (ZVEI), told DW.

Speaking with DW, Thilo Brodtmann, managing director of the German Mechanical Engineering Industry Association (VDMA), shares the view, saying Canada's trade fair partnership is a valuable opportunity.

"We hope that the CETA free trade agreement [between Canada and the EU] ... along with the partnership at the Hanover fair, will further intensify trade between the EU and Canada. Since Canada has not been treated well by Mr. Trump, they will likely look for other markets," said Brodtmann.

The VDMA official described current EU-Canada ties as a "door wide open" that both sides now have the chance to "walk through."

Hanover fair also takes place at a time of political change, with the leadership of both Canada and Germany currently in limbo.

In previous years, government leaders the likes of former German Chancellor Angela Merkel or ex-US President Barack Obama used to open the fair during visits.

This year, however, German Chancellor Olaf Scholz has been voted out of office recently and Canadian Prime Minister Justin Trudeau has resigned. Their likely successors have not yet been officially inaugurated.

After all, for the captains of industry gathered in Hanover, the presence of politicians seems to be the least they are focusing their attention on. What's currently ranking supreme in their minds is certainly the German parliament's recent decision to scrap constitutional limits to fresh government borrowing which is set to free up a whopping €500 billion ($541 billion) in special funds for infrastructure investments.

VDMA chief Brodtmann is now expecting a "massive wave of orders," for which the trade fair is exactly the right venue to make first deals. "The fair can provide a boost, and we are confident that something will end up in our wallets, meaning our order books."

ZVEI Chief Wolfgang Weber particularly welcomes the fact that climate protection is a high priority in the investment package — a precondition set by Germany's Greens party in exchange for allowing the package pass through parliament.

And so, the next government, likely led by conservative leader Friedrich Merz, will have to spend €100 billion of the extra funding on reaching Germany's ambitious climate goals.

"I think it's truly important for Germany to show the world with the investment that climate protection and economic viability can be brought together," Weber said.

While Germany is currently on track of meeting its climate goals, the country's economy has been thrown completely out of balance. At the end of the outgoing government coalition — comprising the environmentalist Greens, the liberal Free Democrats, and the leftist Social Democrats — Europe's biggest economy is heading into a third year of recession in a row.

Hanover fair chief Jochen Köckler, however, warns against pessimism saying that Germany has to be "careful not to undersell ourselves" because of the bad economic news. "The message should be that [the reputation of] 'Made in Germany' is very strong, and we won't back down from global competition," he said.

Köckler even sees historical parallels to 1947, the year when Hannover Messe was established as a company and brand.

With World War II just over for two years at the time, the British occupying forces aimed to stimulate the German economy by showcasing the potential of German entrepreneurs and workers to the world. The plan worked, resulting in export contracts worth nearly $32 million (€29.5 million) in that year.

Therefore, ZVEI's Weber thinks that while the German industry may be struggling at the moment, its technological leadership remains largely intact. "We have integrated automation and digitization into industrial production, significantly advancing efficiency."

The hottest topic at this year's trade fair, however, is the use of artificial intelligence (AI) in industry, says Köckler. But making AI a central theme for the fair isn't window dressing "just for the sake of it," he noted. "Visitors come to the fair to find technologies that will keep them competitive back home."

German industry seeks fresh start in challenging times

The Hanover industrial trade fair, the world's largest industrial trade fair, is taking place in challenging economic times for Germany. With more than 4,000 exhibitors and visitors from approximately 150 countries, the fair aims to promote optimism and foster trust in investments. The fair's partner country this year is Canada, which was chosen two years ago and has become particularly timely given the trade spat with the US. The German parliament's recent decision to scrap constitutional limits on government borrowing is expected to free up €500 billion for infrastructure investments, boosting the industry and making climate protection a priority. The focus of this year's fair is on robotics, mechanical engineering, power-train technology, and energy production, especially with the use of artificial intelligence (AI) becoming a central theme.