Germany signs AI pact with Nvidia as Huang urges adoption

Nvidia CEO Jensen Huang told German carmakers and industrial firms on Monday, October 19, to adopt artificial intelligence quickly and use it to "re-engineer" Germany's struggling business model. He argued that the technology will strengthen heavy industry, not replace it. "Electrons will never replace atoms," Huang said during an onstage conversation with Chancellor Friedrich Merz at the opening of the Invest in Germany Summit in Berlin, the Associated Press reported.bundeskanzler.de

The event took place at Kraftwerk, a former power station. It was the start of a two-day effort by Berlin to draw private investment into an economy that has barely grown since the pandemic. Merz is also looking to AI and to a closer partnership with Nvidia to modernize German industry, according to Reuters.bundeskanzler.de

Data as a "natural resource"

"The next wave of AI is physical," Huang said, pointing to robotics, manufacturing, cars and heavy industry. "AI can only augment your capability. It will not replace your capability". He called Germany's manufacturing data a national resource. He told the audience to import AI technology but not to "export your culture, export your values, export your knowledge," adding: "This industrial revolution is so mighty, so powerful. You don't have another chance."bnnbloomberg.ca

Huang also described Nvidia's work with German industry, from autonomous vehicles to digital twins, which are virtual models used to plan and run factories, Nvidia said. Earlier that day, Siemens announced it is working with Nvidia on AI-driven autonomous factories. Siemens said fully virtual production ramp-ups can cut engineering effort by up to 85%.blogs.nvidia.com

Merz spoke directly to the Mittelstand, Germany's network of small and medium-sized industrial firms. "Please open your doors for AI to make use of your data," he said, adding that he wanted Germany to be "one of the leading, if not the leading, country in the world" in spreading AI across its companies.blogs.nvidia.com

Pact and investments

Merz and two federal ministries signed a Joint Declaration of Intent with Nvidia to develop AI models for physical AI, meaning AI that operates machines and robots in the real world. Euronews reported that the government plans to commit hundreds of millions of euros to the initiative. Most of that money would buy computing capacity in Deutsche Telekom's Industrial AI Cloud. About 10 companies, including Siemens and Audi Volkswagen AG, are expected to take part. Reuters said a formal partnership is expected to be announced during the summit, which continues on Tuesday.euronews.com+2

Huang announced planned Nvidia investments in four German startups: Agile Robots, Avelios Medical, Mirelo and Reflex Aerospace. The company said these are part of a commitment of nearly $10 billion across Europe.blogs.nvidia.com

Tempered expectations

Not everyone expects much from the summit. "Companies don't choose Germany because of a promotional event. What matters is whether they can make money here," said Michael Hüther, director of the German Economic Institute, according to DW. He pointed to high costs for labor and energy and heavy bureaucracy.dw.com