The Schwerin-based factory is about 100km from Hamburg, which is Europe’s biggest port for coffee imports. It is expected to be operational by the end of 2013 and to create up to 450 jobs, the company says.
Nestlé also has two other Nescafé Dolce Gusto factories in the UK and Spain, and this latest facility is intended to produce about two billion coffee capsules a year for Germany, as well as for export to Eastern Europe and Scandinavia.
Nestlé chief executive Paul Bulcke said in a statement: “In spite of the difficult economic environment, we believe in Europe's strength.
“We are convinced that growth is possible. This is why we are not only investing right now, but continuously, in the European market and in convincing innovations, modern technology, and highly qualified employees.
“This factory is not only our biggest investment in Germany, but one of our biggest-ever investments in Europe.”
Germany is the company’s largest market for sales of Nescafé Dolce Gusto, and its fourth largest market overall. The coffee brand generates about 80% of its sales in Europe, where it achieved 30% organic growth during 2012. The brand made more than €100m in sales in Germany alone last year, of a global total of about 740m Swiss francs (about €597m).