Industry Report | Industrial production and trade in the individual industries 13/06/2022
production also curbing the demand for chemicals. Companies’ assessment of the current business situation has deteriorated. Outlook: industry has yet to bottom out Sentiment has clouded over particularly regarding expectations. Since the outbreak of the war in Ukraine, many companies have been bracing for recession. Problems on the supply side are still getting worse. Energy and commodity prices remain on a high level and are proving to be extremely volatile. Bottlenecks among intermediates have continued to intensify, not only in the chemical industry but also among its key customers. Logistic problems are mounting up on account of the war in Europe and the recent lockdown in China. In the months ahead, the majority of companies in the industry expect a downturn. The industrial customers of chemicals are keeping production levels down, above all in Germany and Europe, which, in turn, reduces the demand for chemicals. It remains uncertain whether prospects will brighten towards the end of the year. Companies are particularly concerned about the supply security of oil and gas and the further developments in China. For the year overall, production is very unlikely to match last year’s level. A cut in the supply of gas would be disastrous for the chemical industry and the industrial sector overall.
Contact: Christiane Kellermann / Phone: +49 69 2556 1585 / Mail: kellermann@vci.de
German electro and digital industry: solid start to the year Following a turndown in 2020, the first year of the pandemic, the German electro and digital industry posted robust growth last year. Production increased by nine percent following price adjustment. Growth in nominal sales was even in the double digits, up 10.2 percent year on year. The dynamic growth in 2021 not only compensated for the losses from 2020 but also from 2019, the year marked by industrial recession. Sales for the industry, at 200.4 billion euros, topped the 200 billion euro mark for the first time ever. Incoming orders surged 23.8 percent in 2021, giving the German electro and digital industry a comfortable cushion of orders on their books to start off the new year. The greatly deteriorated macroeconomic environment has so far hardly affected the performance of the industry. With increases in production and sales in the first quarter 2022 of 2.9 percent and 10.3 percent respectively year on year, the electro and digital industry was in good form. Incoming orders registered growth of 14.6 percent in the first quarter, bringing up the reach of orders in hand to a record high of 5.7 production months. Supply chains are still very strained with 89 percent of companies in the electro and digital industry reporting material shortages at the start of the second quarter 2022, which is the highest proportion recorded in this industry since the start of this data series in 1991. The number of employees in the German electro and digital industry was at 879,000 according to the latest figures, which is 1.9 percent more than one year ago. The proportion of the workforce on shorttime work was at just over one percent, in contrast to well over twenty percent in spring 2020.
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