The export business of German mechanical engineering companies in the EU and China declined at the beginning of the year. Demand is weakening in the USA.
Germany’s export-oriented mechanical engineering companies felt the effects of the economic weakness in important sales markets at the beginning of the current year.
The value of exports of machines “Made in Germany” fell in the first quarter, including price increases (nominal), by 4.6 percent compared to the same period last year, as the industry association VDMA in Frankfurt announced with a view to preliminary data from the Federal Statistical Office. Adjusted for price increases (real), a decrease of 7 percent was recorded. In total, machines and systems worth 50 billion euros were exported all over the world. The decline was particularly noticeable in business with EU countries.
According to the information, exports to the European Union countries fell above average in the first quarter by a nominal 7.1 percent compared to the same period last year. With a share of 44 percent of machinery exports, the EU is by far the most important sales market for the industry. The EU economy is now on a moderate recovery path, said VDMA economic expert Benedict Jeske. However, the capital goods industry and mechanical and plant engineering in particular usually only benefited from the improved mood and capacity utilization of their customers in the EU after a delay of several months.
Slowdown in the USA and decline in exports to China
Demand from the USA, the largest single market for machines “Made in Germany”, weakened in the first quarter. Exports to the world’s largest economy rose by 2.1 percent in nominal terms. For 2013 as a whole, there was still a nominal increase of 12.6 percent in the books. The economy in the USA has recently slowed down, explained Jeske.
In China, exports from German mechanical engineering companies were a nominal 2.1 percent below the result of the same period last year. “The Chinese economy continues to suffer from the downturn in the real estate sector, and domestic demand also remains subdued, as our latest economic survey among VDMA members in China shows,” said Jeske.
In 2023 as a whole, companies posted record exports thanks to a strong first half of the year and increased prices, although exports fell towards the end of the year. According to previous information, the export volume increased nominally by 5.9 percent to almost 207 billion euros compared to the previous year.
Source: Stern
