Germany still has one of Europe’s strongest battery-industry foundations, but its advantages are being tested by high costs, regulation and a shifting global supply chain. In an interview with BEST, Friedrich Grupe, chief executive of Digatron Power Electronics, said the country combines established lead-acid production, a growing lithium-ion cell base led by PowerCo, and a large automotive sector that continues to pull in demand for testing and industrial equipment. He said that mix gives Germany a solid technical base, even if many electric-vehicle batteries are still assembled around Chinese cells.
Grupe argued that Germany’s main strength lies in its network of small and midsize engineering companies, especially in mechanical and electrical systems. Digatron, headquartered in Aachen, is among the suppliers building formation and test equipment for batteries across chemistries, and the company says it serves customers globally from production sites in the United States, India and Italy. That industrial depth, Grupe said, has accumulated over decades and remains a major competitive asset.
The downside, he said, is that the business climate often makes it difficult to turn that strength into new plants at home. Energy prices, labor costs and a heavy approval burden have already pushed some companies to move production abroad, according to Grupe. He warned that if core chemical production and intermediate materials keep leaving Europe, the region will become more dependent on imports and less resilient in the face of geopolitical shocks.
He also pointed to Germany’s eastern states as a possible source of new momentum. Because much of the region was rebuilt after 1990, he said, it often has more modern industrial infrastructure than parts of western Germany, making it suitable for large battery plants and data centers. But he said that opportunity is being held back by expensive power and by a permitting system he described as slow and overly complicated.
Germany’s carmakers remain both a strength and a vulnerability for the battery ecosystem. Volkswagen, BMW, Porsche and Mercedes-Benz set demanding standards for quality, safety and traceability, which in turn shapes the work of cell makers, equipment suppliers and laboratories. But that also leaves the sector exposed to swings in the auto market. Grupe said battery research in German universities is technically strong and closely linked to industry, while Digatron’s partnership with Safion, a RWTH Aachen University spinoff focused on battery diagnosis, shows how academic work can move into commercialization when funding, capital and market conditions line up.
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