»We need Air to breathe«

The provider of integrated solutions and branded products in the field of cable and connection technology generated sales of 1.82 billion euros in fiscal year 2024 (October 1 – September 30; fiscal year 2023: 1.92 billion euros). The family-owned company thus remained slightly below the previous year's level, with a decline of 5.3 percent. The number of Lapp employees worldwide rose slightly to around 5,700 as of September 30, 2024.

“It was a challenging fiscal year. Nevertheless, we are looking courageously to the future and are sticking to our global investment program. Continuous digitalization, increased production capacities, expansion of our logistics: That's what will ensure future growth”, emphasizes Matthias Lapp, CEO of Lapp Group, and adds: “What we urgently need from politics now: reliable framework conditions, an end to over-regulation and more trust in domestic companies. We know how to compete and to succeed in the global economy. But for that we need more air to breathe.”

Growth only in Asia

In detail, Lapp's regions developed very differently in the 2024 financial year: The EMEA region (Europe, Middle East, Africa), which continues to generate the largest share of sales in the Group, recorded a decline in sales of around 9%. The decline was particularly high in Germany due to the weakness in the mechanical and plant engineering sector. The Americas region (North, Central and South America) remained only slightly below the previous year's level with a reduction in sales of around 3%. “In the US in particular, we sensed a certain reluctance to invest among many customers before the presidential election. Right now, orders are picking up again. Due to the threat of tariffs, many companies are deciding to invest more locally in the US. And for new production machines, our connection solutions are needed to supply the systems with power and data”, says Matthias Lapp.

The Asia-Pacific region grew strongly. The increase in sales of over 10% was primarily due to business successes in India and South Korea. However, China also developed positively despite a difficult market environment. “India and Southeast Asia are the big winners in the current geopolitical environment. The figures here are also positive for the current fiscal year. This makes me very optimistic that we will be able to counteract the ongoing economic downturn in Central Europe again this year”, says Matthias Lapp.

Investments in digitalization, logistics and production

The company is sticking to its investment program: for example, it is currently expanding its logistics and service center in Ludwigsburg, making it the largest single investment in the company's history. In the USA, production capacity for the manufacture of 'Ölflex' connection and control cables is being massively expanded. Major capacity expansions are also currently underway in India. In the past financial year, the Lapp Group invested a total of almost 66 million euros worldwide. "In economically challenging times, it is particularly important to be close to the customer and to push ahead with investments to achieve this. If you want to grow, you have to invest. Our answer to the decoupling of markets is “local for local” - in other words, developing and producing locally to supply local markets. This is how we make ourselves more independent of geopolitical and economic developments and can optimally serve our customers in the respective country”, says Matthias Lapp.

Danger of deindustrialization

For the current financial year, the company is again expecting single-digit sales growth. Successes in Asia and the USA in particular are expected to contribute to this. “Our problem child remains Europe, especially Germany. Due to the threat of deindustrialization, demand for our connection solutions is also dwindling. We very much hope that the upcoming federal elections in Germany will give us entrepreneurs new momentum to strengthen the business location”, underlines Matthias Lapp, adding: “Germany is our home. It is an attractive country with many talents and great inventive spirit. And we are happy to take responsibility for our employees and their families here. But the government also has to show family businesses that they are truly wanted and welcome in Germany. A stable government that makes quick and pragmatic decisions would be an important first step in this direction. This is the only way we can remain competitive in Germany and Europe.”