Weak Order Bookings in the German Machine Tool Industry

Order bookings and turnover in the German machine tool industry (Source: VDW)

Order bookings and turnover in the German machine tool industry (Source: VDW)

In the third quarter of 2014, order bookings in the German machine tool industry fell by eight per cent compared to the third quarter of 2013. Domestic orders were nine per cent down on the preceding year, export orders seven per cent lower. For the first three quarters of 2014, order bookings were one per cent up on the equivalent period in 2013 overall. Domestic orders rose by eight per cent, while demand from abroad dropped by three per cent.

“Order bookings have not come up to expectations so far in 2014”, says Dr. Wilfried Schäfer, Executive Director of the German Machine Tool Builders’ Association VDW in Frankfurt am Main. Most recently, following a strong first half of the year, domestic orders took a downturn in the year’s third quarter. Growing uncertainty on how the global economy will develop is downgrading the propensity to invest among German customers, a situation exacerbated by the crisis in the Ukraine, the dormant state of business with Russia, and the cautious development in China.

Dr. Wilfried Schäfer, Executive Director of the German Mach­ine Tool Builders’ Association Frankfurt / Main. (Source: VDW)

Dr. Wilfried Schäfer, Executive Director of the German Mach­ine Tool Builders’ Association Frankfurt / Main. (Source: VDW)

This is also showing up in order levels from abroad. Although the smoothed curve, adjusted for seasonal effects, has for some months now been pointing upwards, the anticipated vigorous upturn has not yet materialised. This is being mirrored in the ups and downs of the monthly figures. There was surprising encouragement from the euro nations. Here, orders have been rising for a good four months and most recently, in the year’s third quarter, increased by twelve per cent. The Eastern European nations, in particular Poland, Hungary and Czechia, are reporting excellent growth rates.
A look at the technologies involved reveals that project business for forming technology, especially, is decreasing, due to a weak month in September. As a general principle, demand in this segment is characterised by marked cycles, triggered by the procurement behaviours of the biggest customer grouping, the automotive industry. Forming technology accounts for 25 to 30 per cent of total production output.
Turnover in the year’s first three quarters finished at minus six per cent. The VDW is now predicting a roughly unchanged total production output for 2014. This means the result would continue to lie at the preceding year’s high level of 14.6 billion Euros. (Source: VDW)

Links: VDW German Machine Tool Builders´ Association

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