A recent study highlights a clear trend: German companies are turning to Spain – and especially Madrid – to expand their industrial and technological footprint. The region’s mix of competitiveness, innovation, and stability is making it a natural choice for long-term investment in Southern Europe.
According to a 2025 report by the German–Spanish Chamber of Commerce (AHK Spain), 40% of German companies are planning new investments in Spain. This figure confirms the sustained appeal of the Spanish market for German businesses, driven by a stable macroeconomic environment, continued industrial recovery, and the rise of technology-driven and sustainable industries. Among Spanish regions, the Community of Madrid stands out as a central hub for investment combining world-class infrastructure, a competitive business climate, and an internationally connected industrial fabric.
Madrid: a strategic hub for German industry
The Madrid region now hosts a growing share of German subsidiaries in Spain, particularly across the automotive, industrial, energy, and technology sectors. Major players such as Siemens, Bosch, Bayer, and Lufthansa Technik illustrate the diversity of German activities in the region — from manufacturing and engineering to logistics, services, and R&D.
Several structural advantages explain this success:
- A strategic location connecting the main Iberian and European corridors;
- Competitive operating costs compared to other European capitals;
- A highly qualified talent pool, supported by leading technical universities;
- A business-friendly regulatory environment with proactive institutional support for foreign investors.
A long-standing economic partnership
Germany remains Spain’s second-largest trading partner, just behind France. In 2024, bilateral trade exceeded €80 billion, driven by strong exchanges in machinery, chemicals, electrical equipment, and industrial vehicles. In the Madrid region, this cooperation translates into an expanding network of technological and industrial partnerships, particularly in aerospace, healthcare, clean mobility, and digital manufacturing. Many German SMEs are now involved in joint initiatives supported by the Community of Madrid, sectoral clusters, and regional R&D centers.
A stable and attractive investment environment
The Community of Madrid consistently ranks among Europe’s most attractive regions for foreign investors. Its predictable regulatory framework, political and economic stability, and high-quality logistics infrastructure — including Adolfo Suárez Madrid-Barajas Airport and extensive road and rail networks — make it a prime location for international operations. Industrial investment and innovation support programs, combined with a dynamic ecosystem of SMEs and mid-cap companies, enable foreign firms to integrate quickly and sustainably into the local economy.
A stable and attractive investment environment
The Community of Madrid consistently ranks among Europe’s most attractive regions for foreign investors. Its predictable regulatory framework, political and economic stability, and high-quality logistics infrastructure – including Adolfo Suárez Madrid-Barajas Airport and extensive road and rail networks – make it a prime location for international operations. Industrial investment and innovation support programs, combined with a dynamic ecosystem of SMEs and mid-cap companies, enable foreign firms to integrate quickly and sustainably into the local economy.