Markus Kamieth is the chief executive officer of BASF SE, the world’s largest chemical company, at a moment of extraordinary pressure. Since taking over in 2024, he faces the confluence of weak global demand, rising regulatory and energy costs, and a protracted downturn in Europe’s industrial sector. Under his leadership, BASF is trying to modernize, restructure, and defend its position as the backbone of German industry — all while navigating what many analysts call the most challenging period for the chemical sector in decades.
A Struggling Sector
Since 2022, the global chemical industry has taken a strong beating, especially in Europe. High gas and electricity prices, declining orders from automotive and manufacturing clients, plus sharp price competition from Asia, have all squeezed margins. Few companies have felt these pressures more strongly than BASF, with its immense German footprint.
In recent quarterly results, BASF reported slightly lower sales year-on-year and weaker profits across core commodity chemicals. Divisions like Agricultural Solutions and Surface Technologies performed better, while the traditional chemicals business long considered the backbone of the company suffered through low prices and industrial overcapacity. It also saw free cash flow move into negative territory in the first half of 2025, further raising investor concerns regarding BASF’s long-term financial resilience.
Kamieth has been vocal about the situation, referring to it as “probably the most difficult time in 25 years,” with the emphasis that the crisis is structural in nature rather than short-term. All these pressures have pushed BASF into deeper cost-cutting, unit closures, and reevaluation of its global footprint.
Kill the ‘Deindustrialization’ Narrative
Yet Kamieth categorically denies that Germany is embarking on an irreversible process of deindustrialization. He insists that while some production will move overseas and some sectors will contract, Germany will continue to be an industrial country, with manufacturing remaining one of the core elements of the national economy.
He says such terms as “deindustrialization” are hyperbolic, suggesting that industry is standing at the edge of some precipice, overlooking its complete disappearance. In reality, it will mean restructuring, modernization, and selective downsizing-but not collapse-of Germany. BASF itself continues to invest billions in its domestic operations, even as it expands in markets like China and North America.
According to Kamieth, the company’s Ludwigshafen site – BASF’s largest integrated chemical complex – remains the “heart chamber” of the German industry. He argues that much of Germany’s manufacturing chain would be disrupted if Ludwigshafen were to shut down. This is why the company – in spite of criticism – invests more in Germany than in any other country.
A Transformation Strategy
Under Kamieth, BASF embarked on a strategic shift. Instead of staying reliant on commodity chemicals, it is moving toward higher-margin and more resilient businesses. These include agricultural products, coatings, specialty materials, and advanced industrial solutions. These units are less vulnerable to cyclic declines and often make more substantial contributions to the bottom line.
The future of several business lines is under review from Kamieth. Internal discussions include a potential restructuring or listing of the agricultural unit, and there will be divesting of lower-performing operations. This reflects a broader trend in the chemical industry where companies are increasingly streamlining their businesses to focus on higher-value-added segments.
Meanwhile, BASF is continuing with its major international investments unabated. Critics think that the company is becoming too dependent on China, but he says international expansion is necessary to keep a German enterprise globally competitive. Repeatedly, however, he emphasizes that even if the share of total capacity here was to decline somewhat, Germany remains BASF’s most important base.
Regulation and Competitiveness
A major challenge Kamieth points out is that of Europe’s regulatory environment: climate-policy reforms, rising carbon pricing, and stricter environmental regulations result in significantly higher operating costs for energy-intensive industries. Climate policy is very important to Kamieth, but it needs to be balanced against economic competitiveness. If this does not happen, then Europe will risk losing these industries altogether.
High energy prices, especially since 2022, further raise the competitive disadvantages of Europe’s chemicals sector compared to the United States and Asia, where energy costs are lower. This is one of the core reasons why BASF is geographically diversifying its production while continuing to invest in modernization at home.
Looking Ahead
Markus Kamieth’s leadership reflects a blend of realism and determination. He recognizes the structural problems that BASF and German industry are suffering from, but he rejects fatalistic forecasts and favors long-term investments. His strategy is unmistakable: streamline the portfolio, strengthen the high-value segments of business, continue to maintain Germany as an industrial hub, and modernize worldwide operations to be resistant against fierce international competition. And as it passes through this period that is so important, the following years will be a test of whether Kamieth’s balanced approach — cautious but forward-looking — can reshape the company for a more resilient future.
