Roman Matys, President of the International Investment Office, sets Kärcher CEO Hartmut Jenner’s column in Euronews alongside a Rzeczpospolita report on Chinese home appliances in the EU market and explains why Europe’s deindustrialisation gives Ukraine a chance to return to the logic of the “Lviv Region: Factory of Europe” strategy.
Within a few days, two European outlets wrote about the same thing from different angles. On 31 October Euronews published a column by Hartmut Jenner, who has run the German company Kärcher since 2001. On 2 November the Polish daily Rzeczpospolita ran a piece on how Chinese home appliances are pushing Polish ones out of the EU market. The first was written by the head of a large family-owned exporter, the second by an economics journalist. Both reach the same conclusion: manufacturing in Europe pays less and less, and factories are starting to look for somewhere else to go.
I have worked in investment for more than 25 years, and to me these two texts are a signal for Ukraine. First, what they say.
A storm seen by an exporter: Hartmut Jenner’s column
Anyone who has washed a car with a pressure washer knows Kärcher. The company was founded in 1935 in Winnenden near Stuttgart and is still family-owned. Last year its turnover was almost €3.5 billion, and 86% of that came from abroad. It employs around 17,000 people and operates in 87 countries. A business like that feels world trade in its own sales, so its CEO is worth listening to.
Jenner writes that Europe and Germany are caught in a “perfect storm”. The US threatens tariffs and nobody can predict its next move. China moved past cheap production long ago and now competes aggressively on technology, helped by state subsidies, an export-friendly yuan and surplus capacity that has to be sold somewhere. Under those conditions, Jenner says, fair competition for a private company is almost impossible.
The hardest part of his column is about deindustrialisation. Jenner stresses that it is already happening: car and machinery plants in Germany are closing or moving away. He calls the 1.3% growth forecast for the German economy “borrowed”, because it is driven by public debt, defence spending and subsidies, with little private investment in it. New production sites in Germany and Europe barely pay off at current labour and energy costs.
Jenner puts part of the blame on Europe itself: reform fatigue and regulation coming out of Brussels and Berlin. His recipe is simple. Cut reporting and paperwork, and turn public offices into a fast, AI-assisted service. Lower energy prices and payroll charges. Increase hours worked through overtime incentives, flexible schedules and easier hiring of specialists, because demographics leave no other option. And run a tough EU trade policy towards those who break the rules.
He ends with a line that stuck with me: whoever rests, rusts, and that is as true for economies as it is for people.
A €150 washing machine: Chinese appliances in the EU market
The Rzeczpospolita piece shows what this storm looks like in one specific industry. From January to July this year China shipped more than 26.5 million household appliances to the EU, 12.1% more than a year earlier, worth over €3.2 billion. China’s share of the European market passed 38%. Over the same period Polish exports fell to 9.1 million units, and by 6% in value, to just over €2 billion. Poland’s share dropped to 13.2%.
Only a few years ago Poland was Europe’s main supplier of home appliances. It has 30 large-appliance plants, including five Electrolux factories as well as Amica, BSH and Beko sites. Together with suppliers the industry employs more than 100,000 people, and that number is shrinking.
Across the EU, large-appliance production has fallen by 22% in five years. Five factories closed in Europe last year. A Spanish manufacturer was bought by China’s Midea, a French one went bankrupt.
One comparison quoted by importers explains it best. A Chinese washing machine costs about €150, a Turkish one about €220, a Polish one about €270.
Polish manufacturers name the same causes as Jenner. China deliberately supports exports with tax breaks, advisory services and logistics. Chinese factories first produced for European brands and then began pushing their own. Meanwhile a European plant pays for climate policy, expensive energy, transport and new regulation, and weak demand doesn’t let it pass those costs on to the price.
The heads of Amica, Beko, BSH, Electrolux and the industry association APPLiA are asking Brussels for protection. Their main demand concerns the carbon border tax, CBAM. The European Commission’s draft covers only washing machines, fridges and dryers, about 47% of Poland’s large-appliance output. The industry wants to add dishwashers (Poland makes 60% of all dishwashers in the EU), ovens, cookers, hoods and hobs. Manufacturers also want stricter checks on imports for safety and energy efficiency, and incentives for buyers to choose high-efficiency European appliances. The Polish government has even dropped a scrappage scheme for old appliances, although in Germany, according to industry representatives, the sector is holding on despite expensive labour.
Rzeczpospolita itself admits an awkward fact: even if CBAM is extended to the whole industry, a Chinese appliance will become only €2–3 more expensive. That won’t close a €120 gap on a washing machine.
What the two stories have in common
Put the two texts side by side and the picture is fairly clear.
European manufacturing is squeezed from two sides. From outside come state-backed Chinese exports and unpredictable US trade policy. From inside come expensive energy, expensive labour, a shortage of workers and regulation that adds costs every year. Europe responds with protection: it talks about “Made in Europe”, extends CBAM and promises tighter import controls. Protection alone won’t level the price of a washing machine, and even those asking for it admit as much.
Companies, meanwhile, do what they always do: they calculate. Kärcher, Electrolux or Amica can’t wait for Brussels and Berlin to agree on reforms. If a new production hall in Germany or Poland doesn’t pay off, the company will look for a place where it does, ideally one where the product stays “European” and avoids the new tariffs.
The logic of the “Factory of Europe” is back
This is exactly the situation we wrote the “Lviv Region: Factory of Europe” strategy for. From 2016 to 2021 I headed the Investment Policy Department of the Lviv Regional State Administration. I wrote the strategy myself and implemented it with a team we built from scratch. The idea was simple. Working at home is expensive for European manufacturers, and shipping goods from Asia is slow and risky. So they need a site close to the EU market where production is cheaper, logistics are short and people know how to work and want to. That logic brought the Lviv region almost a billion dollars of foreign direct investment and around 75,000 jobs.
Jenner’s column and the Rzeczpospolita report show that this logic is highly relevant again. European costs have risen further. Supply chains from Asia have become a political risk. And Polish appliances, which once beat Western European ones on price, are now losing to Chinese ones. Manufacturers need a place between expensive Europe and distant China. It would be a sin not to use that.
Where Ukraine can win the investor
An investor coming from Kärcher or Electrolux will calculate the same things Jenner does. They’ll look at energy costs, taxes, how long permits and reports take, and of course they’ll factor in the war. Some of these conditions we can’t change. Taxes and bureaucracy are entirely in our hands.
Just apply Jenner’s list to Ukraine. Cut reporting and inspections. Issue permits within a few weeks. Give new production a tax regime better than in Poland, Romania or Slovakia, the countries we compete with for the same factories. Make the state a service for investors, and do it before Berlin delivers on Jenner’s demands.
These changes would work for people too. Many Ukrainians today stand at assembly lines in Poland, Czechia or Germany. If Ukraine gets factories with better taxes and less bureaucracy than the EU, wages here can move closer to European levels. Then those people would have a strong reason to come home and work at the same kind of plant, only near Lviv or Lutsk.
The Polish example is even encouraging here. Our neighbours also pay for expensive energy, and their government is in no hurry to help even its own manufacturers. When an investor compares several countries, the deciding factors are often the speed and predictability of decisions. Those we can change ourselves, with no outside conditions.
A reminder for Kyiv and Brussels
One more thing is worth pointing out. Europe has already decided to protect what is made in Europe, and the rules for that protection are being written right now: the scope of CBAM, the “Made in Europe” criteria, demand-support programmes. It would be good if Kyiv and Brussels remembered that products from Ukrainian factories serving the European market are European too. If the rules are adopted without that, rewriting them later will be much harder.
Poland is already losing the European market over a €120 difference in the price of a washing machine. The factories looking for a new home will find one in the next few years. I want some of them to stand in the Lviv region, Volyn or Zakarpattia.
Roman Matys is President of the International Investment Office and author of the “Lviv Region: Factory of Europe” strategy. From 2016 to 2021 he headed the Investment Policy Department of the Lviv Regional State Administration.
Frequently asked questions
According to Kärcher CEO Hartmut Jenner, new production sites in Europe barely pay off because of expensive energy, high labour costs, worker shortages and excessive reporting. From outside, subsidised Chinese exports and US tariffs add pressure.
According to Rzeczpospolita, from January to July 2026 China shipped more than 26.5 million household appliances to the EU and its market share passed 38%. Polish exports fell to 9.1 million units and Poland’s share dropped to 13.2%.
Even if CBAM covers all home appliances, a Chinese device will cost only €2–3 more. The price gap on a washing machine between China (about €150) and Poland (about €270) is around €120, so the tax won’t close it.
It is the investment strategy Roman Matys wrote and implemented in 2016–2021 as head of the Investment Policy Department of the Lviv Regional State Administration. It offered European manufacturers a site close to the EU market and brought the Lviv region almost a billion dollars of foreign direct investment and around 75,000 jobs.
Cut reporting and inspections, issue permits within weeks, give new production a tax regime better than Poland, Romania or Slovakia, turn the state into a service for investors, and make sure CBAM and “Made in Europe” rules treat products of Ukrainian factories as European.