The Baden-Württemberg Freight Forwarding and Logistics Association (VSL) 🚛🛡️📦 sets requirements for logistics in relation to defense capability

Published on: July 30, 2025 / Updated on: July 30, 2025 – Author: Konrad Wolfenstein

The Baden-Württemberg Freight Forwarding and Logistics Association (VSL) sets requirements for logistics in relation to defense capability – Creative image: Xpert.Digital

Trade and security: The growing responsibility of the logistics industry in Germany

Why is the Baden-Württemberg Freight Forwarding and Logistics Association (VSL) focusing on defense issues?

Why did a state association for commercial logistics dedicate its annual general meeting to Germany's defense capabilities?

The VSL represents around 450 freight forwarding, transport, and logistics companies with approximately 60,000 employees in Baden-Württemberg. These highly export-oriented companies feel the direct impact of geopolitical conflicts, trade restrictions, and increased security risks. Supply chains are becoming more fragile, transit routes less secure, and global traffic flows increasingly affected by customs and sanctions regimes. The association concludes that economic resilience and military defense capabilities are inextricably linked: If Germany is poorly supplied in a crisis or alliance conflict, trade and prosperity will also come under pressure.

What threats to peace, freedom and supply chains does the VSL identify?

What specific risks does the association see?

The speeches at the general meeting outlined two levels of threat. First, wars and conflicts—especially Russian aggression against Ukraine—endanger transport routes and the flow of energy and raw materials. Second, tariffs, sanctions, and a global subsidy race create new barriers for exporters; small and medium-sized enterprises (SMEs) in particular suffer from sudden rerouting and longer processing times. The association warns that a combination of these two factors ultimately undermines free global trade and thus the foundation of the German industrial model.

What is the justification for VSL President Dr. Micha Lege's demand to provide logistical support to the German Armed Forces?

What is the meaning behind the guiding principle "Our logistics companies can and must support the German Armed Forces"?

Dr. Lege draws a parallel to NATO's dual-track decision of the 1980s: Back then, the business sector supported political decisions to protect freedom and the market economy. Today, the industry must once again demonstrate responsibility and offer its expertise – warehousing, transport, IT management – as a strategic backbone. The president emphasizes that large-scale military transport, depots, and maintenance in crisis situations rarely function without civilian commercial resources. The Bundeswehr Logistics System (LogSysBw) already explicitly provides for the integration of third-party services into national supply processes.

What new direction is CDU parliamentary group leader Manuel Hagel calling for, and how does the truck toll fit into that?

What key messages did Hagel make to the association members?

Hagel stated that the "old rules"—cheap gas from Russia, American security guarantees, and inexpensive intermediate goods from China—are obsolete. He called for new free trade agreements and partners, because global competition is not standing still. Regarding logistics policy, he declared that with the CDU in power, there would be no tolls on state and local roads in the next legislative period and praised the "road finances road" principle, which strengthens the earmarking of federal toll revenues. His stance has a history: As early as 2022, he opposed a state-level expansion of tolls, arguing that inflation and the energy crisis were burdening the industry. The VSL (Association of German Logistics Companies) welcomed this position, as additional toll burdens would further weaken competitiveness.

What economic consequences of this turning point did ARD stock market chief Markus Gürne describe?

Why does a financial journalist rate the special fund positively?

Gürne points out that Germany's business model relies on export flows and is therefore dependent on stable supply chains. Geopolitical tensions increase the risk of costly disruptions. A strong European security architecture, financed by a dedicated special fund, is therefore a matter of sound business practice. He argues that investments in defense and modern infrastructure will reduce future costs of avoidable disruptions while simultaneously creating high-tech contracts for industry.

How is the 100 billion euro special fund for the German Armed Forces structured and where does it flow?

What can the money be used for and what proportion is allocated to logistics projects?

The Basic Law and the Federal Armed Forces Financing and Special Assets Act stipulate that the funds should close capability gaps and strengthen alliance and defense capabilities. Specifically, the scope includes investments in armaments, ammunition, infrastructure, IT security, key technologies, and logistics. The full €100 billion is contractually committed until the end of 2024; the budget for 2025 projects expenditures of approximately €22 billion, including transport, depots, and military IT networks.

Why does the VSL demand that special funds not be used for social spending?

Why does Dr. Lege emphasize the earmarking?

The association president points out that special funds represent debt. They are only legitimate if they increase productivity, security, and growth. If funds flow into ongoing social transfers, the investment effect is lost; then companies have to bear higher interest and tax burdens without gaining a competitive environment. This position aligns with fiscal policy debates in the Bundestag, where several parliamentary groups are pushing for strict earmarking of defense and logistics investments.

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Hub for security and defense - Image: Xpert.digital

The hub for security and defense offers well-founded advice and current information in order to effectively support companies and organizations in strengthening their role in European security and defense policy. In close connection to the SME Connect working group, he promotes small and medium -sized companies (SMEs) in particular that want to further expand their innovative strength and competitiveness in the field of defense. As a central point of contact, the hub creates a decisive bridge between SME and European defense strategy.

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The Working Group Defense of the SME Connect - Strengthening SMEs in European defense

How the German Armed Forces and private logistics will have to work together in the future

What does the required "economic transformation" mean for logistics companies?

What structural changes is the association demanding?

Dr. Lege states that the logistics sector is already experiencing its worst crisis in decades – weak industrial production, rising energy costs, and a shortage of skilled workers are coinciding with investment backlogs in ports, rail networks, and digital customs systems. An economic transformation must accelerate approval processes, guarantee planning certainty for infrastructure projects, and create tax incentives for low-CO₂ propulsion technologies. Without these measures, the goal of achieving both climate neutrality and defense capability remains illusory.

How is military logistics structured in Germany today, and where does it need civilian support?

Is the Bundeswehr's logistics sufficient for a large-scale deployment?

The German Armed Forces' Logistics Command in Erfurt plans and manages all national and international logistics operations; it oversees six mobile logistics battalions, depots, training schools, and a special engineer battalion. Nevertheless, the German Armed Forces' operational concept acknowledges that organic capacities alone are insufficient. Host Nation Support and framework agreements with freight forwarders are intended to secure transport, handling, and storage during simultaneous NATO deployments. The German Armed Forces view Germany as a "logistical hub" on NATO's eastern flank, which necessitates close cooperation with private carriers and terminal operators.

What legal instruments regulate the integration of private logistics?

On what basis can freight forwarding companies be obligated or commissioned?

In peacetime, federal authorities conclude framework transport contracts with logistics service providers; the Federal Office for Infrastructure, Environmental Protection and Services of the German Armed Forces handles the billing. In times of tension or defense, the Transport Services Act and Host Nation Support Agreements also apply, regulating requisitions, deployment credits, priorities, and compensation. The VSL (Association of German Logistics Companies) urges that these regulations be modernized to ensure legal and cost certainty when truck fleets or warehouses need to be used for military purposes at short notice.

What role do customs policy, sanctions and trade disputes play in the current situation?

How do trade barriers affect operational logistics?

Every new tariff or sanctions list creates additional documentation, control, and storage risks. Containers back up because dual-use goods are subject to more thorough inspections; spare parts reach production facilities late. Companies therefore need larger buffer stocks and more transport capacity, which is difficult to finance during a recession. At the same time, sanctions can unexpectedly shift logistical routes, for example from land to sea or via third countries—with cost and time risks that also affect military deployment planning if civilian networks are to be used in parallel.

How do the defense budget and special funds affect the overall German budget?

Will defense spending increase permanently?

The draft federal budget for 2025 allocates €53.25 billion to core budget item 14; including special fund resources, defense spending amounts to just over €75 billion, exceeding the NATO two percent target for the first time in decades. From 2028 onward, once the special fund is exhausted, substantial additional budgetary resources would be required to maintain this level or raise it to three percent of GDP. Without a budgetary consensus, funding gaps are therefore a real threat – a risk that also dampens private investment in defense and logistics.

What digital requirements will military and civilian logistics face?

Why is digitalization a core theme of the special fund?

Modern warfare demands networked situational awareness, real-time tracking, and cyber-resilient supply chains. Radios, satellite-based data links, and cloud-based warehouse management accelerate transport and are suitable for dual use between military and civilian fleets. Freight forwarders who want to remain interoperable in these networks must harden their IT interfaces and train staff to meet standards such as NATO encryption or EDI formats.

How can climate goals, technological openness and national defense be combined?

Are CO₂ reduction and military robustness mutually exclusive?

Hagel advocates for technological openness regarding climate-friendly propulsion systems. The logistics industry is testing biofuels such as HVO100 and e-fuels, which, according to industry projects, can reduce emissions by up to 90 percent. At the same time, fuels must remain suitable for military storage and internationally available. Hybrid solutions – diesel-electric trucks with modular batteries – could operate sustainably in peacetime and use conventional fuel in emergencies. Crucially, investments must be predictable; constant regulatory changes slow down fleet conversions and jeopardize the achievement of targets.

What recommendations does the VSL formulate for policymakers and businesses?

What specific steps does the association recommend following the members' meeting?

First, the federal and state governments should limit infrastructure approval processes to a maximum of two years to expedite the expansion of road and rail freight corridors. Second, the VSL demands a crisis mechanism that transparently prioritizes military and civilian logistics needs so that companies can adjust their capacity planning. Third, it calls for accelerated tax depreciation allowances for alternative drive systems and digital security technology. Fourth, the German Armed Forces and industry should conduct joint exercises to test IT interfaces, customs procedures, and deployment routes.

What lessons will the logistics industry draw from the 2025 annual meeting?

What remains of the Esslingen meeting?

The event made it clear that supply chain security, military national defense, and economic competitiveness cannot be treated separately. Freight forwarders, shippers, politicians, and the media share the assessment that geopolitical tensions are here to stay and that a robust security architecture is essential. While the €100 billion special fund provides the German Armed Forces with a modernization boost, true sustainability can only be achieved through close integration with private logistics. At the same time, fiscal and regulatory policies must relieve the burden on the sector, rather than imposing additional levies. The VSL sees this as the core of an economic transformation that simultaneously advances freedom, infrastructure, and climate protection.

Your dual -use logistics expert

Dual -use logistics expert - Image: Xpert.digital

The global economy is currently experiencing a fundamental change, a broken epoch that shakes the cornerstones of global logistics. The era of hyper-globalization, which was characterized by the unshakable striving for maximum efficiency and the “just-in-time” principle, gives way to a new reality. This is characterized by profound structural breaks, geopolitical shifts and progressive economic political fragmentation. The planning of international markets and supply chains, which was once assumed as a matter of course, dissolves and is replaced by a phase of growing uncertainty.

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