Germany’s mechanical and plant engineering companies are still struggling with customer reluctance. In February, incoming orders adjusted for price increases (in real terms) were 17 percent below the previous year’s level, as reported by the VDMA industry association in Frankfurt.
“The decline can be explained in particular by the fact that the economic situation continues to be characterized by numerous challenges, which is causing many investors to be cautious,” explained VDMA economics expert Olaf Wortmann.
In addition, according to the information, there were a particularly large number of orders in the same month last year. “The bar for incoming orders in February this year was therefore high,” said Wortmann. In the less volatile three-month period from December 2022 to February 2023, orders fell by 17 percent in real terms compared to the same period last year.
In 2022 as a whole, a slump in orders in the final quarter pushed the annual balance sheet of the export-oriented German key industry with more than one million employees into the red: In real terms, incoming orders were ultimately four percent below the previous year’s value. According to earlier information, the VDMA expects a slight decline in production of two percent in real terms for the current year.
