Germany is transforming its industry, shifting from automobiles to the defense sector, in the context of economic stagnation and competition from China.

Germany, once the industrial engine of Europe, is facing an unprecedented stagnation, and its export model is collapsing. In the face of competition from China and declining demand, Berlin is redirecting its attention to the defense industry. Approximately 15,000 jobs are disappearing monthly from the manufacturing sector, and companies like Mercedes-Benz and Volkswagen are reporting significant losses. In this context, Germany aims to become the backbone of European defense, redirecting industrial capacities to the needs of rearmament. Recently, legislation has facilitated access for defense companies to capital markets, unlocking considerable funds. Auto manufacturers, such as Volkswagen, are collaborating with Israeli firms to produce components for defense systems. The German government supports this transformation, encouraging the redirection of the workforce and production lines to the defense sector, where demand is increasing. The company Deutz, for example, has managed to avoid layoffs by quickly adapting to the new requirements of the defense industry.