en.Wedoany.com Reported - Siemens AG has announced an investment of €300 million to expand its electrical switchgear production in Germany, including the construction of a new supplier factory in Offenbach and upgrades to two existing plants in Frankfurt. The expansion project is scheduled to start in July 2026, aiming to meet surging global demand from AI data centers, electric vehicles, and industrial automation. This move will directly impact fast-growing markets such as Mexico, which faces delivery bottlenecks of up to 18 months for critical power distribution equipment, constraining the country's data center expansion.
This investment in Germany is part of Siemens' global capacity expansion plan for 2026. In March 2026, the company announced a $165 million investment in its U.S. factory to support AI and data center growth. According to the plan, the supplier factory in Offenbach will begin production in spring 2027, and the entire expansion project is expected to create up to 700 new jobs by the end of 2030.
Siemens is the only company in the world to produce medium-voltage and high-performance switchgear systems at a single location. Its Frankfurt plant serves as the global competence center for gas-insulated switchgear. The plant has developed switchgear that does not rely on sulfur hexafluoride, a climate-damaging insulating gas, instead using a clean air gas solution composed of natural components from the surrounding atmosphere.
The products being expanded are medium- and high-voltage electrical switchgear, used to distribute power from transmission grids to buildings, industrial facilities, and data centers. Siemens' smart infrastructure business achieved a record €1.9 billion in orders from data centers in the second quarter of fiscal 2026; in the first half of 2026, related technology revenue surged over 45% to €1.8 billion.
Global demand for switchgear continues to surge, but supply faces severe constraints. Delivery lead times for certain categories of electrical switchgear have extended to 18 months or longer, causing projects that have already received permits and financing to stall while waiting for equipment. Siemens' expansion in Frankfurt is a direct response to this supply bottleneck.
The situation in Mexico has exacerbated the global equipment shortage. Siemens describes its Mexican operations as capacity-constrained. In April 2026, Mexico's national data center operational capacity reached 279 MW, doubling from 115.5 MW in 2024. The Mexican Data Center Association (MEXDC) estimates that the industry's installed capacity could reach 1,516 MW by 2030, attracting over $18 billion in direct investment. However, this growth trajectory depends entirely on whether switchgear and distribution equipment can connect data center loads to the grid in a timely manner. The National Electrical Manufacturers Association of Mexico (CANAME) notes that under the framework of Plan México, such equipment should increasingly be supplied by domestic manufacturers, and Siemens' investment addresses this supply chain gap at a global level.
