Germany and Nvidia Prepare a Nine-Figure-Euro Industrial AI Pact, With Siemens, Audi and Black Forest Labs at the Table

Germany is preparing a wide-ranging artificial intelligence cooperation agreement with Nvidia, according to a Handelsblatt report citing people familiar with the plans, and the deal is expected to be formally announced next week at the "Invest in Germany" summit in Berlin, where Nvidia CEO Jensen Huang will appear alongside Chancellor Friedrich Merz.

German media reports said the federal government is prepared to commit a three-digit million euro sum to the program, with the money earmarked for compute procurement and the training of new industrial AI models. Nvidia is expected to contribute hardware and engineering support, including engineers seconded to German partners. The government has not commented on the report.

The pact has two declared goals. The first is to lay the groundwork for "physical AI" — models used to train robots and self-driving vehicles — inside German industry. The second is to help Germany develop internationally competitive, high-performance industrial foundation models of its own.

Roughly a dozen German companies are expected to take part, with Siemens, Audi and generative-image startup Black Forest Labs named in the reporting. The initiative is built around SOOFI, the Sovereign Open Source Foundation Models consortium launched in September 2025 to unite research institutions, universities and AI companies behind the development of large open models.

The reporting describes a choreographed political rollout. Huang is expected to arrive in Berlin on Monday as Merz's guest of honor at the summit, and the two are set to meet in the evening at a Kraftwerk event, followed by a three-way session with Mercedes-Benz CEO Ola Källenius. German media framed the meeting as a signal that Germany, after years of stagnation, wants to present itself as an attractive destination for investment and innovation again.

The move fits a broader European sovereignty push. German officials said last month that the country remains committed to strengthening its AI capabilities to reinforce Europe's digital sovereignty, and the SOOFI program is the most concrete vehicle for that ambition so far. A partnership with Nvidia — whose chips and software underpin most frontier model training — gives the consortium immediate access to the toolchain its US rivals use.

If confirmed on Monday, the deal would add a government-backed industrial customer base to Nvidia's European footprint at a moment when AI spending is under intense scrutiny. For Germany, the bet is that coupling its industrial base to physical AI — robotics, autonomous driving and smart manufacturing — converts its manufacturing strength into an AI advantage rather than a dependency. The details, including the exact funding figure and Nvidia's own commitments, remain to be seen.