for larger scale operations in the Atlantic, the kriegsmarine needed Atlantic bases ultimately... not just supply ships and subs. as was pointed out earlier... even very large supply subs just wouldnt hold enough fuel to support surface ops.
France was a start, gaining ports for their warships and u-boats in the Biscay bay.
I think the running and gunning blitz the Germans put forth that captured large territories in a short time gave them a bit of overconfidence.
I seriously think that German high command felt that Britain would have been forced out of the war in somewhat short order, as happens in military circumstances and operations - the enemy, and the whole strategic picture really - were underestimated. Had they not overestimated their enemy, Germany may have sought to secure the Azores, or form an alliance of sorts with Iceland as part of their long term operational strategy, but this didnt happen
this underestimation forced the Germans into a bit of a constant "catch up" game in the Atlantic. The allies, for the most part, stayed a step ahead of the Germans in that particular theater of operations. not only in production of the sheer number of merchant craft, but ultimately in technology and tactics as well
they obviously never recovered the upper hand
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