Ifo Institute Survey: US Tariffs Continue to Burden German Industry

Berlin (ANTARA) - A survey released by the Munich-based Ifo Institute on Wednesday (22 July) has found that United States (US) tariff policy continues to burden Germany’s industrial sector. Many producers are postponing investments and passing increased costs on to their customers in the US.

The survey, conducted among roughly 1,800 manufacturing companies in June, found that 62 per cent of firms said US tariffs were having a negative impact on their business. In the mechanical engineering and automotive sectors, more than 70 per cent of companies reported such negative effects.

“Even in the second year of Donald Trump’s presidency, US tariff policy remains a significant burden for German industry,” the Ifo Institute said.

Companies are also preparing for tariffs to remain high in the long term, with 63 per cent of respondents expecting tariff levels to stay elevated through the end of President Trump’s term.

This uncertainty is also affecting investment decisions. Nearly 40 per cent of companies said they had cancelled, postponed, or relocated investment projects in response to US trade policy.

The impact is also being felt on investment within Germany, with 16 per cent of firms that had investment plans saying they had cancelled projects domestically as a result of the policy — nearly double the proportion reported a year earlier.

To cope with higher tariffs, companies are increasingly passing the additional costs on to customers. Among affected exporters, 34 per cent said they had passed the entire tariff cost on to their US customers, whilst another 28 per cent had passed on more than half of those costs.