Global mechanical engineering
On the way to pre-crisis level CETOP market outlook web conference online, February 10th 2021
www.vdma.org VDMA | Anke Uhlig
China: Industrial production by sectors
Real, yoy, % Manufacture of Special-Purpose Machinery 20
20
10
10
0
0
-10
-10
-20
-20
-30
-30
20
20
10
10
0
0
-10
-10
-20
-20
-30
-30
2013
2014
Source: NBS, Macrobond, VDMA VDMA | Anke Uhlig
Manufacture of General-Purpose Machinery
2015
2016
2017
2018
2019
2020
5-month moving average Page 2 | Feb. 10th '21
EU / USA / JP: Machinery production
Volume index, 2015 = 100 and 12-months moving average EU-27*
130
Japan
USA
120
Jan- Nov. 2020/2019
110
EU-27: - 13%
100
Jan- Dec. 2020/2019
90
Japan: -12%
80
USA:
-9%
70 60
2008
2009
2010
2011
2012
Source: National Statististics, VDMA, Macrobond
VDMA | Anke Uhlig
2013
2014
2015
2016
2017
2018
2019
2020
*) NACE rev. 2 28.
Page 3 | Feb. 10th '21
EU-27: Production* in mechanical engineering
January - November 2020/2019, %, real 0 -1 -3
-5 -7
-8
-10
-10 -11 -13
-15
-13
-14
-14
-14
-14
-14 -16
-20
FI
NL
DK
HU
Source: Eurostat, Macrobond, VDMA
VDMA | Anke Uhlig
PT
SE
CZ
EU27
FR
DE
PL
ES
BE
IT
-16
AT
*) NACE rev. 2 28.
Page 4 | Feb. 10th '21
EU-27: Capacity utilization in mechanical engineering industry In % of full capacity level of output quarterly values
95
average 2008 - 2020
90 85 80 75 70 65 60
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Source: EU DG ECFIN, Macrobond, VDMA
VDMA | Anke Uhlig
Page 5 | Feb. 10th '21
Germany: Incoming orders in mechanical engineering Domestic and Foreign Volume index 2015 = 100 Domestic
140
Foreign
130 120 110
Jan.-Dec. 2019/18: - 9 % Jan.-Dec. 2020/19: - 13 % %
100 90
Jan.-Dec. 2019/18: - 9 % Jan.-Dec. 2020/19: - 6 %
80 70 60
2011
Source: VDMA
VDMA | Anke Uhlig
2012
2013
2014
2015
2016
2017
2018
2019
2020
12-months moving average Non-adjusted indices
Page 6 | Feb. 10th '21
VDMA member companies: Existing disturbances (except supply and demand side or liquidity shortages)
VDMA | Anke Uhlig
Page 7 | Feb. 10th '21
World: Industrial production and Purchasing Managers’ Index manufacturing (PMI)
Index 59
PMI manufacturing (lS)
yoy, %
Industrial production, 3mma (rS)
9
56
6
53
3
50
0
47
-3
44
-6
41
-9
38
2015
2016
2017
2018
2019
2020
2021
-12
Source: cpb, IHS Markit, Macrobond, VDMA
VDMA | Anke Uhlig
Page 8 | Feb. 10th '21
World: Mechanical engineering turnover, Scenarios by Oxford Economics Index 2019Q4 = 100, real Rapid Upturn
Baseline forecast
Global Second Wave
110 108 106 104 102 100 98 96 94 92 90
2019
2020
2021
2022
Source: Oxford Ecnomics (8th Dec 2020)
VDMA | Anke Uhlig
Page 9 | Feb. 10th '21
VDMA member companies: Expected development on sales markets in 2021 compared with the previous year Evaluable answers, shares in % clearly worse
60%
worse
same
better
clearly better
50% 40% 30% 20% 10% 0%
Germany (N = 575)
Europe (without Germany) (N = 565)
China (N = 499)
Asia (without China) North America (USA and South and Middle (N = 492) Canada) (N = 514) America (Mexico incl.) (N = 488)
Quelle: VDMA, 9th flash survey on coronavirus, January 2021
VDMA | Anke Uhlig
Page 10 | Feb. 10th '21
Germany: Machine production including VDMA forecast until 2021 %, yoy, real 6
4.0
3.9 3
1.2
1.1
0
2.1 0.8 -0.3
-1.2
-3
Forecast -2.6
-6 -9 -12 -15
-12.1 2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Source: Federal Statistical Office, VDMA
VDMA | Anke Uhlig
Page 11 | Feb. 10th '21
VDMA-member companies: Expected return to the 2019 turnover level Evaluable answers (N = 522, N = 574); shares in % 24 September 2020
60 50
22 January 2021
46 39
40 30 20
21 13
18
16
15
18
10 0
4 probably no turnover losses 2020
2021
2022
2023
5
2024
2
1
2025 to 2030
2
1
never
Source: VDMA, flash surveys on coronavirus, September 2020 to January 2021
VDMA | Anke Uhlig
page 12 | Feb. 10th '21
Your contact.
Anke Uhlig VDMA Economics and Statistics Lyoner Str. 18 60528 Frankfurt, Germany Phone +49 69 6603-1388 Email anke.uhlig@vdma.org
VDMA | Anke Uhlig
Page 13 |
Feb. 10th '21
Oxford Economics Basline Scenario •
In the near future, global production will be restricted by social distancing measures, especially throughout Europe, before a vaccine is introduced around mid 2021 to begin a large-scale and permanent reduction in restrictions. A global second wave of Covid-19 will be avoided.
•
Fiscal policy: Significant tightening after substantial support in 2020.
•
Europe: Upswing in Q1 2021, when companies will reopen. But: Households and companies are looking more cautiously to the future and are prepared for further disruptions in 2021.
•
USA: Republicans expected to retain control of the Senate. In early 2021 a financial package of 1.5 trillion US dollars is expected. Deterioration in the health situation and weakening economic momentum are weighing on the US economy.
•
GDP: 2020 minus 4.1 percent | 2021 plus 4.8 percent, supported by a complete easing of social distancing in mid 2021.
Source: Oxford Economics, as of December 8, 2020 VDMA | Anke Uhlig
Page 14 | Feb. 10th '21
Oxford Economics Scenario Rapid Upturn •
Generally available medical advances - such as a vaccine, therapeutics or robust track and trace networks - allow a faster return to normality, with restrictions being eased three months earlier than in the baseline.
•
The upturn in tourism continues to boost international trade, especially in services.
•
Stronger demand will lead to higher oil prices in 2021, averaging around $51 per barrel.
•
Governments with fiscal space provide their economies greater fiscal incentives than assumed in the baseline forecast. For example, the US economic stimulus programs following the elections are increasing government consumer spending by more than 3.5% above the baseline forecast by the 4th quarter of 2021.
Source: Oxford Economics, as of December 8, 2020 VDMA | Anke Uhlig
Page 15 | Feb. 10th '21
Oxford Economics Scenario Global Second Wave •
The number of coronavirus cases is rising sharply worldwide in the first quarter of 2021, and demand is faltering with the introduction of lockdowns and social distancing measures. W-shaped upswing leaves economic scars.
•
The reintroduction of restrictions leads to an immediate decline in household consumption and business activity. As a result, unemployment rises sharply, reaching 9% according to ILO definitions at the global level.
•
Brent crude oil reaches a low of USD 30 per barrel and recovers weakly. The prices of other commodities, with the exception of gold, are also falling.
•
Fiscal support is more limited and less effective than in the first wave. After an expensive first wave, the policy response is more focused on monetary policy measures.
•
Restrictions will be lifted in Q2 2021. An initially strong upswing is followed by sluggish growth due to increased risk aversion among households and companies. Source: Oxford Economics, as of December 8, 2020
VDMA | Anke Uhlig
Page 16 | Feb. 10th '21
EU: Investment in equipment & machinery and capacity utilization in manufacturing industry %, yoy
% Investment in machinery & equipm (left scale)
15
Capacity utilization (right scale)
87
10
84
5
81
0 -5
78
-10
75
-15
72
-20
69
-25 -30
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014 2015
2016
2017
2018
2019
2020
2021
66
Source: Macrobond, VDMA
VDMA | Anke Uhlig
Page 17 | Feb. 10th '21