The German Machine Tool Builders' Association (VDW) reported its member businesses’ second-quarter 2019 orders fell -22% below the total for the comparable period of 2018, with significant decreases from domestic (-28%) and foreign (-18%) buyers. It is the latest data to document the decline in manufacturing demand in Europe.
VDW further reported that first-half 2019 new orders fell -21%, with a -19% drop from the domestic market and a -23% decrease in orders for export.
Machine-tool orders are regarded as a leading indicator of manufacturing activity, as machine shops and other manufacturing businesses make capital investments to prepare for anticipated industrial orders.
"The base effect can no longer disguise the global decline in investment in mechanical and plant engineering," according to Dr. Wilfried Schäfer, exec. director of VDW.
"We are in the same boat as the other major international suppliers,” Schäfer added. “Orders for machine tools have collapsed worldwide. Many countries are now having to pay the price for the almost daily international disputes being picked by politicians."
Last month CECIMO, the consortium of national machine-tool trade associations in Europe reported the eight largest member groups registered a -14% drop in order volume during Q1 2019. CECIMO attributed those results to weaker trade volumes, low business confidence, and geopolitical risks weighing on demand.
U.S. machine tool orders are reported monthly by AMT – the Assn. for Manufacturing Technology, in its U.S. Manufacturing Technology Orders Report. For June, U.S. machine-tool new orders totaled $357.8 million, down -15.2% versus June 2018. The year-to-date total is $2.25 billion, -12.8% from January-June 2018.
“The manufacturing technology market is under pressure from ongoing trade issues and a global manufacturing slowdown, which is driving competitiveness in the North American market,” stated AMT president Doug Woods. “Our members are adjusting their business models to address these challenges and analysts’ predicted fall in order levels in 2019.”
