VDW Revises Production Forecast for German Machine Tool Industry

Frankfurt am Main, Germany – VDW (The German Machine Tool Builders’ Association) has revised its production forecast for the current year owing to the second wave of coronavirus, expecting a decline of about 30 percent, which represents a loss of € 5 billion in terms of production volume. At approximately € 12 billion, this volume is still 2 billion above the posted 2009-10 financial crisis, and the industry return is expected to its 2019 level only in the medium term.

The German machine tool industry in the third quarter of 2020, the orders received were 29 percent down on the same period last year, whereas from within Germany the orders fell by 26 percent. Orders from abroad also were 30 percent fewer and in the period from January to September the orders fell by 33 percent. In addition, domestic orders were 27 percent down on the previous year. There was a 36 percent reduction in the level of orders from abroad. Partial lockdowns have been imposed in Germany and in many other European countries, making it difficult for machine tool customers to plan investments and make decisions. Asia, and China in particular, is recovering faster, the situation in Europe, by contrast, remains much more tense.

The electronics industry, medical technology, ventilation equipment and consumer-related areas such as the food and packaging industry are few client sectors to post gains amidst the current crisis. The automotive industry, on the other hand, has also been badly hit by the crisis but is profiting from rising demand in China, yet the structural change towards new types of drives is heavily felt, and investment budgets are increasingly being reapportioned.

“The machine tool industry is now fully in the grip of the second corona wave,” asserted Dr Wilfried Schäfer, Executive Director, VDW. “The economic indicators rose in the third quarter, but any hopes of a short-term improvement are now fading fast. Orders received in the third quarter remain at the low level of the previous months.”

Image Source: VDW