Most advances in German airplane technology were performed by the Luftwaffe during the late 30s and early 40s.
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In the beginning of the war the Germans quickly established air superiority. Their aircraft was far superior and the Germans were years ahead of all other nations. The Focke-Wulf and later Messerschmidt models could outmaneuver and out hit any fighters manned by the allies. Their Heinkel bombers and Junker dive bombers were terrors of the sky and could decimate whole cities and armies. Their later development of the jet engine propelled them even further to wear they were decades ahead of anyone else. The Messerschmidt Me 262 was the first ever operational Jet Fighter and could basically outrun and outlast any other fighter for the next couple of decades. These technological advances granted Germany air superiority in almost every theater of war. However, once the Allies started to catch up and develop their own technology. The Germans couldn't keep up with American industry and production. 
(From top to bottom: Focke-Wulf, Messerschmidt Bf 109, Messerschmidt Me 262)