September 28, 2022

Machine tool orders stable in Germany – Metrology and Quality News

In the second quarter of 2022, order intake in the German machine tool industry increased by 24% compared to the same period last year. In this context, orders from Germany increased by 27% and those from export markets by 23%. In the first half of 2022, orders overall increased by 34%. Domestic orders contributed with a 35% increase and foreign orders with a 33% increase.

“Despite the current difficult conditions, machine tool orders continued to develop well in the second quarter. Compared to the first half of the year, volumes are even almost at record levels since 2018. Business abroad is mainly supported by demand outside the EU. In particular, our two main markets, China and the United States, remain strong. The severe lockdown in Shanghai and other Chinese cities did not leave deeper scars in the second quarter,” comments Dr. Wilfried Schäfer, Executive Director of the VDW (Association of German Machine Tool Builders), Frankfurt am Main. “In terms of technologies, cutting machining is currently driving the overall result. Demand in the first half of the year was twice as strong as that of forming technology. This is an indication that major projects in the automotive industry are currently on hold, especially in Germany,” Schäfer added. Forming technology accounts for approximately 30% of total machine tool sales. Press technology in particular is used in large projects.

Sales remain a concern. In the first half, it was 7% higher than in the same period of the previous year. In real terms, the result means stagnation. “As a result, as feared, supply chain issues are far from resolved,” says Schäfer. After all, capacity utilization increased slightly from 85.9% in April to 87.4% in July.

70% of German machine tool production is for export, which picked up in the second quarter. The statistics thus show an increase of 5% during the first six months. Exports to Asia grew the strongest in a regional comparison at 11%. However, China, the largest market, made a disproportionate contribution, with a 5% increase. By contrast, Japan, India, and some smaller Southeast Asian markets adopted German machine tools with double-digit growth rates.

Business with US customers also continues to be strong, up 9%. Europe stagnated at the level of the previous year, with exports to Eastern Europe in particular collapsing due to the Russian breakaway. Exports to Western Europe, on the other hand, recovered markedly.

Imports increased by 16% in total. Asian suppliers in particular are leading the way. “They are obviously able to circumvent the supply chain problem better”suspects Schäfer.

“The uncertainties for economic development have increased further”, VDW Executive Director Schäfer summarizes. As for the Russian-Ukrainian war, he says, there is no end in sight. The energy supply for the coming fall/winter remains uncertain with corresponding consequences on prices. In China, the largest market, there are signs of weak overall economic growth. Added to this are the geopolitical dangers in relations with Taiwan. As a result, the business climate in the machine tool industry has soured. “At least on the positive side, there is still a great need for investment in climate change. The investment program recently adopted in the United States will also give impetus to the industry,concluded Schäfer.

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