A Frankfurt hotel with a faulty heating system seemed like a fitting site for the VDW (German Machine Tool Builders’ Association) to predict a cooling of this year’s growth rate for machine tool production following a record rise in 2011.
Speaking at the association’s annual press conference, VDW Chairman Martin Kapp said German machine tool manufacturing jumped 33% last year, but growth will slow to 5% in 2012. Last year’s production value of €13.1 billion exceeded the €9.9 billion total in 2010 while falling short of the 2008 record of €14.2 billion.
“There are still concerns about macroeconomic risks such as the euro debt crisis or the turbulence on the financial markets,” Kapp said. “Above all, midsized companies are waiting because uncertainty is poison for investment decisions.”
VDW members reported their first negative monthly order growth in more than two years in December, and Kapp blamed the muddled picture of the world economy as a reason some customers have been delaying purchases.
Kapp said German machine tool manufacturers were running at 95.6% of capacity in January after an average of 93.8% in 2011. The expected slowdown in production growth has its advantages, the VDW chairman said. Kapp pointed out that machine tool producers can now work through their order backlogs and meet delivery dates.