The growth rate of the German machine tool industry has stabilized

After experiencing rapid growth for several consecutive months, the German machine tool industry gradually stabilized again. According to the German Machine Tool Manufacturers Association (VDW), in the third quarter of 2011, orders from the German machine tool industry increased by 29% year-on-year. Among them, German local orders increased by 33%, and overseas export orders increased by 27%. In the first nine months of 2011, demand for machine tools in Germany increased by 74% year-on-year. Among them, German orders increased by 71% year-on-year, and overseas orders also increased by 76% year-on-year.

Dr. Wilfried Schafer, Executive Director of VDW, pointed out: “This year, German machine tool orders have always maintained growth and performed exceptionally well. Despite this, from quarterly data comparisons, industry order growth has shown a downward trend. After a few, or even three-digit, growth rates, the industry’s tendency towards regularization is predictable.”

The good performance of orders has once again significantly increased the utilization rate of the machine tool industry. In October this year, the capacity utilization rate of the German machine tool industry has reached 95.5%, which means that the company is running at full capacity. Compared with the same period of 2010, the capacity utilization rate of the industry at the time was only 75.4%, vividly illustrating the challenges faced by the industry. As of September, the total number of employees in the German machine tool industry was 66,865, a year-on-year increase of 4.4%.

In the first nine months of this year, the total output of German machine tools increased by 36% year-on-year. Schafer pointed out: "From a year-round perspective, it is expected that the industry situation will be better than previously expected. The latest forecast is that in 2011 Germany's machine tool production will increase by 1/3 year-on-year."

In spite of this, given the ongoing uncertainty in the financial markets, especially the continual spread of the European debt crisis, companies expect the outlook for the coming months to be bleak. Schafer pointed out in the report that these external factors have been superimposed on the demand trend of the normal cycle. However, the product structure and customer base remain the most influential factors among various factors that affect the sales of different companies. For the suppliers of customized machines, especially those with long production cycles, the unscheduled orders will be nearly 10 months, together with the continuous investment demand of the automotive industry and its system suppliers, plus energy equipment and aircraft. The strong demand of manufacturers, combined with these factors will enable the development of the company to produce a stable result.