“China Shock 2.0” Hits German Industry Hard as Exports Slip and Imports Surge

“China shock 2.0” is increasingly blamed for worsening pressures on German industry as demand shifts and Chinese competition intensifies. Since 2020, Germany’s trade relationship has changed sharply: Chinese imports rose quickly while exports to China fell. Core sectors such as automobiles and machinery saw displacement both in China and third markets, and at times even at home as Chinese EVs gained ground. The result is mounting anxiety in Berlin and Brussels over deindustrialisation risks and the need for stronger trade and industrial responses.