German automakers and machinery manufacturers must rapidly embrace artificial intelligence to "re-engineer" the country's struggling economy by utilizing its rich manufacturing data and engineering expertise, Nvidia CEO Jensen Huang has urged.
Huang, whose firm creates the advanced processors and software powering AI models for developers like Anthropic and OpenAI, emphasized that digital tools will not supplant the physical engineering and manufacturing sectors where Germany has extensive experience.
Or, as he noted, "electrons will never replace atoms." However, he said industrial sectors would benefit by embracing technology.
"The next wave of AI is physical. This is where AI interacts with the physical world: robotics, manufacturing, cars, heavy industry," Huang said Monday during a panel with German Chancellor Friedrich Merz at an investment conference in Berlin.
"And so AI can only augment your capability. It will not replace your capability. So take advantage of the technology."
Huang said Germany's manufacturing expertise "is your natural resource, it belongs to the nation" but warned it must better leverage AI: "This industrial revolution is so mighty, so powerful. You don't have another chance," he said.
European leaders like Merz view AI as a growth driver, but fear reliance on U.S. tech firms. Europe's rich public-sector and machine-readable manufacturing data offer a key way to compete with the U.S. and China, a strategy previously noted by former European Central Bank head Mario Draghi.
Both Huang and Merz described AI as a major opportunity for Germany's "mittelstand," the hundreds of small and medium-sized firms operating in specialized industrial fields.
Merz is struggling to revive growth following post-pandemic stagnation. Germany's export economy—producing cars, trains, aircraft, and industrial equipment—faces high energy prices after losing cheap Russian gas following the Ukraine invasion, rising competition from China, and excessive bureaucracy holding up projects.
Europe also lags the U.S. in building data centers that provide massive computing power to train AI applications, raising fears that sensitive European corporate data on U.S.-owned servers remains exposed to the American legal system.
Huang addressed those concerns by urging Germany to import foreign technology without surrendering local assets, saying "you should not export your culture, export your values, export your knowledge."
He urged the nation to "take advantage of artificial intelligence. Let them codify, let them program, let them teach this artificial intelligence and keep it here in Germany, and let's re-engineer, the chancellor's words, Germany. This is your chance to do it."
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