Amazon, the American retail giant and tech conglomerate, is planning a major investment in Germany, with most of the funds earmarked for expanding the cloud business of its data center in the Rhein-Main-Gebiet region.
Germany’s Amazon headquarters announced on June 19 in Munich that the company plans to invest 10 billion euros in Germany, with a small part of it going towards expanding logistics, robotics technology, and two new company headquarters, while the majority (88 billion euros) will be injected into cloud internet services. By the end of 2024, the formal employee count at Amazon Germany is expected to increase to 40,000 people.
Established in the summer of 1994, Amazon currently employs over 1.5 million individuals worldwide, with the majority still based in the United States. However, Germany stands out as an important overseas market for Amazon. The company announced in May its plans to build a “AWS European Sovereign Cloud” for Europe, with a budget of 7.8 billion euros, starting with the Brandenburg region. The significant investment in the Rhein-Main-Gebiet adds an extra 10 billion euros, bringing the total planned investment in Germany by the conglomerate to 17.8 billion euros.
The Amazon group aims to expand its Amazon Web Services (AWS) business. Their business model is based on taking over the operation of large AWS data centers for corporate clients and providing IT services. According to industry sources, the 10 billion euros will cover construction and data center operational costs, as well as expenses for machinery and software imports.
Data from the U.S. market research firm Synergy Research Group shows that in the first quarter of this year, AWS maintains its undisputed global cloud service market leadership with a 31% market share worldwide, despite facing some setbacks in cloud competition with Microsoft. AWS believes that the demand for cloud services in Germany will continue to grow.
Amazon is also expanding its online retail business in Germany. In May, a new logistics center was opened in Erfurt, and another logistics center will be launched in Horn-Bad Meinberg in North Rhine-Westphalia by the end of summer. Previously, a new logistics center in Großenkneten, Lower Saxony, commenced operations in August 2023. Furthermore, new company headquarters are under construction in Munich and Berlin. The group stated that since 2010, Amazon’s total investment in Germany has exceeded 77 billion euros.