That's not how it works. While there is an east/west divide in Germany, it's along the former border. Bavaria is amongst the most expensive places in Germany in regards to labor and land. Also not more government subsidies than anywhere else in the former West.
Sure, you save a lot by going east. But that means the real east, i.e. the new states.
I'm really dubious of the claim that labor in .de is super expensive. I know that most software devs there make way less thank 100K euro's/year. That's much, much lower compared to the US. Housing costs (buy/rent) in .DE are much lower compared to the US as well.
I have coworkers in Berlin who are pitching me to move over there because it's so easy to live well there.
Edit: I think the problem with "high labor costs" is not monetary, but bureaucratic. It's damn near impossible to get people to work near 40 hours a week. It's hard to get them to do on-call shift work. It's also really difficult to fire people in .de
Note that in this subthread we were just discussing differences in costs within Germany, nothing more, nothing less. Nobody claimed that labor and land was expensive compared to say the US. Only that it is much, much cheaper in Chemnitz than in Nuremberg. Just 200km away from each other but worlds apart in operating costs.
Sure, you save a lot by going east. But that means the real east, i.e. the new states.