From the outbreak of the First World War his command concentrated on destroying British commercial and troop shipping, with considerable success. As Japan enetered the war, Spee's squadron moved to South America. At the Battle of Coronel, off the coast of Chile, on 1 November 1914, Spee's force engaged and sank Sir Christopher Cradock's force of two cruisers, HMS Good Hope and HMS Monmouth, when the German force outclassed the British one in both gunnery and seamanship.
On 8 December 1914, Spee's force attempted a raid on the coaling station at Port Stanley in the Falkland Islands, unaware that the previous month the British had sent two modern fast battlecruisers (HMS Inflexible and HMS Invincible) to protect the islands and revenge the defeat at Coronel, and there were also five cruisers, HMS Carnarvon, HMS Cornwall, HMS Kent, HMS Bristol and HMS Glasgow, at the Port Stanley naval base. In the ensuing Battle of the Falkland Islands, Spee's flagship, Scharnhorst, together with Gneisenau, Nürnberg, and Leipzig were all lost, together with some 2,200 German sailors including Admiral von Spee and his two sons. Only the Dresden managed to escape.