America’s Growing Importance: German Companies Establish a Second Home in the US

BMW and the U.S. – It’s an impressive success story. Nowhere else does the Munich manufacturer sell that many cars. Today, BMW has even become the biggest exporter of cars made in North America. At last week’s general shareholders meeting, CEO Norbert Reithofer said proudly, “The U.S. is our second home.” He wants to invest over one billion dollars into the main plant in South Carolina.

America as a market and production base has become more important, not only for German car manufacturers, but also for major chemical, pharmaceutical and mechanical engineering companies, according to a new poll carried out by the consulting firm Accenture. Two thirds of the 120 CEOs of major German companies think that the importance of the U.S. market for their respective companies will grow.

The survey, which was obtained exclusively by the Handelsbatt, was worked out in the run-up to the “Global Business Dialogue,” a German-American conference held in Berlin today. The participants certainly won’t have to worry about the state of German companies in the U.S. “Most of them are clearly expanding,” says Nicola Michels with the German-American Chamber of Commerce in New York.

The results gathered by Accenture point to the same direction. More than half of those questioned intend to create new jobs soon. Job cuts, on the contrary, are planned by only 5 percent of the German outlets. Despite the difficult situation in the job market, this trend has been going on for quite some time now. According to the chambers of commerce, last year, the top 50 German outlets employed 461,000 people – 8 percent more than in 2010. The turnovers rose similarly quickly – to over $300 billion. 86 percent of those surveyed expect even higher revenues in 2012.

The sizable and, after the dip in the economy, soon growing consumer demand is cited as the main motivation behind the companies’ involvement in the U.S. Presently, even German manufacturers at home are benefiting from this situation. In comparison to the same quarter a year ago, German exports to the U.S. were up at about 21 percent.

The surveyed companies’ outlook for the European market, however, is not quite that rosy. About two thirds are of the opinion that when it comes to their overall business, the U.S. will continue to become more important than Europe. However, things are vice versa when you compare the U.S. to China. Again, two thirds believe that their involvement in China will develop faster than it does in the U.S.