- 'Extremely challenging' - The business association worries
The President of the State Association of Employers' Associations in Rhineland-Palatinate, Johannes Heger, urges swift relief for the economy in light of impending company relocations or shifts in production. He expressed concern upon hearing that energy-intensive companies like chemical giant BASF were no longer operating certain facilities, stating to the German Press Agency in Mainz, "If those involved in location policy do not see that they need to improve things quickly, but instead think they can just sit it out, they will be proven wrong." Global players make decisions promptly and clearly.
Heger warns of relocations or investment halts. Just mid-July, BASF announced it would cease production of the active ingredient glufosinate-ammonium (GA) at its Knapsack and Frankfurt sites by the end of the year, citing cost pressures. Earlier this year, BASF also announced the closure of several chemical plants at its Ludwigshafen headquarters due to high energy prices, including one for ammonia and the plastic precursor TDI.
Regarding BASF's idled facilities, Heger said, "This behavior by a very large company shows that while they do communicate the problems they're facing at the location, they only do so once. The next time, the decision to abandon the site will come from the boardroom."
Meanwhile, small and medium-sized businesses also raise these issues but remain inactive. "What the middle class does: it stops investing." In essence, this has the same impact as a large company shifting part of its production to a foreign plant or a small business delaying its next investment.
Rhineland-Palatinate's high industrial and raw materials sector, along with its high export ratio, makes the situation particularly challenging. In addition to high energy costs, other obstacles include skilled labor shortages, research restrictions, and excessive bureaucracy. Heger also raised the issue of commuting to work in rural areas, stating that mobility is a significant concern.
He criticized many political concepts, saying, "Many seem to have been thought up in Berlin but not tailored for Rhineland-Palatinate. We don't have a comprehensive U- and S-Bahn system." People here must find alternative ways to get to their jobs.
Parallel to these challenges, companies must engage with artificial intelligence (AI), which is not yet happening sufficiently in many places. "I believe the concrete understanding is still lacking," Heger said. "I don't want to accuse individual companies of not having sat in some meeting. But when it comes to what AI actually means and where it's headed in their own company, more thought needs to be given to that."
Heger expressed concerns to the German Press Agency about energy-intensive companies like BASF closing facilities, stating, "If policy makers fail to act swiftly, they will be proven wrong." Later, Heger commented on BASF's idled facilities, stating to the same agency, "This behavior by a large company demonstrates the need for companies to communicate their issues more frequently, lest they decide to abandon the site entirely."
