Energy prices squeeze European industry: what the numbers show

Playmobil has stopped making figures in Germany. The last shift at the Dietenhofen plant in Bavaria ended in the week of 22 June 2026. Remaining staff went on paid leave ahead of an official shutdown at the end of the month, Brussels Signal reported. The Horst Brandstätter Group, which owns the brand, confirmed that production would move to existing plants in Malta and the Czech Republic.

Around 350 jobs are affected.

The company blamed high energy prices, along with elevated wages and ancillary labour costs. That combination had been building for years, and the company said the decision to move production was not taken lightly. The Horst Brandstätter Group has not announced any further closures in Germany. Moving all figure production abroad is still a big change for a brand tied to Bavarian manufacturing for decades. Administrative and logistical functions will stay in Germany. The toys themselves will now be made entirely outside the country that created them.

What the figures actually say

Energy costs in Europe have moved sharply against industrial users. Germany's household electricity prices are the fifth most expensive in the world and the second highest among major industrial nations, according to Brussels Signal. Energy-intensive processes have been exposed since the 2022 crisis, despite partial government relief.

The pressure shows up elsewhere too. Residential heat pump sales across 11 European countries rose 17% year on year in the first quarter of 2026, from 494,000 units to around 575,000, the European Heat Pump Association said. France, Germany and Poland averaged 25% growth. Austria was the exception, down 30% because subsidies were withdrawn.

Demand for electricity is rising at the same time. In the United States, wholesale power costs in the PJM Interconnection, which covers Northern Virginia's datacenter cluster, climbed from $77.78 per megawatt-hour in the first quarter of 2025 to $136.53 in the same period of 2026. That is a 75.5% increase, according to Monitoring Analytics, the market's official monitor. The watchdog was blunt about the cause. "Data center load growth is the primary reason for recent and expected capacity market conditions, including total forecast load growth, the tight supply and demand balance, and high prices," its Q1 2026 report states. PJM told The Register it was working with states and member companies on consumer impacts. Monitoring Analytics did not respond to questions.

Why this matters beyond one factory

Playmobil is a mid-sized manufacturer, not a strategic industry, and its closure is largely symbolic. But the mechanics it cited are the same ones facing heavier users. Labour-intensive plastic injection moulding is exposed to power prices in a way that software or services are not. When the gap between German and Czech or Maltese costs is wide enough, the plant moves.

German business groups have framed the decision as the latest example of a once-thriving mid-sized enterprise forced abroad. Unions called it a catastrophe for the region. Administrative and logistical functions stay in Germany, but the figures themselves will now be made entirely outside the country that created them.

"This broad bring-your-own new generation solution to the issues created by the addition of unprecedented amounts of large data center load does not require a continued massive wealth transfer through ongoing shortage pricing."

That argument, from Monitoring Analytics, is about who pays for grid upgrades. It is also the central question for European industry: whether the cost of new generation and transmission lands on the companies driving demand, or on everyone else. The report warns that the proposed PJM backstop auction would "generally shift significant risk to other PJM customers," a temptation it says "should be resisted."

In Europe the picture is more fragmented. The European Commission has outlined VAT and tax reductions and social leasing schemes for lower-income households to support heat pump adoption, though EHPA director general Paul Kenny called on EU governments to implement those measures rapidly. National subsidy decisions still drive outcomes: Austria's 30% sales fall happened because support was withdrawn, not because prices eased.

There is no single European electricity price, no single industrial policy and no single answer. What connects a Bavarian toy plant, a Dutch datacenter and a Polish household heating system is the same arithmetic: when energy is a large share of operating cost, a sustained price gap moves investment. The Q1 heat pump numbers suggest some consumers are already responding. The Playmobil closure suggests some manufacturers no longer can.