Mechanical and plant engineering
VDMA expects significantly higher production for 2018
At the VDMA's economic press conference, association president Carl Martin Welcker announced an increase in the production forecast to 5%. This increase is based, among other things, on good demand prospects in the German mechanical and plant engineering sector.
Mechanical engineering companies in Germany expect the economy to remain strong in the current year. VDMA President Carl Martin Welcker assumes that "the growth of recent months will continue both nationally and internationally despite many uncertainties. "In view of quite dynamic incoming orders, which are now gradually turning into sales, as well as good prospects for demand, the VDMA is increasing its production forecast from plus 3 to plus 5 percent in real terms," explains Welcker.
The mechanical engineering industry in Germany thrives on exports in particular: over three quarters of all goods produced are exported. "We expect growth here on a broad basis with differences in detail," said the VDMA President. The largest single market - the United States - will continue to develop expansively. The American corporate tax reform with its significantly improved depreciation conditions could stimulate new investments, also because America has to import many machines. "However, the sword of Damocles hangs over us in the form of the current trade conflict, the effects of which on the mechanical engineering industry in particular cannot yet be estimated," says Welcker. "This is certainly a risk for our production forecast that should not be underestimated."
The association anticipates a slowdown in exports to China, partly because 2017 brought particularly high export growth. In contrast, deliveries to EU partner countries will continue to increase, according to VDMA economists. "Only for business with the UK do we expect a sharper decline than in 2017, when exports fell by 3%. We cannot even rule out a double-digit decline - Brexit will leave a clear mark on investments on the island," says the VDMA President.
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