A lot of reasons why German Industry was historically smaller had to do with resources, for eg: In 1913, Germany had somewhere around 67% or so of the USA's per capita industrialisation and in 1939 it had actually slipped to less than 60%.
Why? more to do with the drastic fall due to the War, Depression and Versailles resulting in loss of "exports" and subsequent "belt-tightening".
If the Resources are available, the German Economy could have expanded, the proof that they could have is in the 1960s and 1970s, when West Germany surpassed first France and then UK and reached about 75% of the USA's per capita levels and has more or less maintained that position till date despite an extremely costly unification in the 1990s. All this while being on the "Gold Standard".
Again, historical data tells us that in the 1500s and pre-30 year War, the German states had higher per-capita income than the UK, the 30 year War and subsequent Industrialisation in the UK changed all that and made England twice as rich as Germany in the 1850s (as a whole and in per-capita terms), but by 1913, Germany had surpassed the UK though in per-capita terms it was still only 80% of the UK. That is a phenomenal growth curve for an economy on the "Gold Standard".
If and a BIG IF, Germany wins against the USSR and creates a puppet state on the A-A line as it envisaged in various memorandum, it would have become an Industrial Giant, the Oil Fields of the Caucasus, the Minerals in the Donetsk basin, etc will make them the premier Industrial Power of the World at par with the USA.