VDW reported new orders for German machine-tool exports are rising, and expectations are high for that trend to be evident at EMO Hannover 2017. HELLER Machine Tools HF Series 5-axis horizontal machining center

Machine Tool Demand Weak But Growing, VDW Reports

Low order volume in Germany during first half of 2017, but export demand is rising and more improvement is forecast

The German machine tool manufacturers association reported that second-quarter 2017 new order fell 7% year-over-year, with domestic orders falling 27% and export orders down 4%. Through the first six months of this year, new orders are down 1% year-over-year, with domestic (German manufacturers) orders down 15% but foreign orders up 6%. Orders for forming machinery are performing better than those for metal-cutting machinery.

VDW (German Machine Tool Builders’ Association) represents manufacturers in Europe’s largest machine-tool manufacturing industries, and one of the largest in the world.

In its first-quarter 2017 report VDW detailed that new orders for machine tools rose 6% over the comparable period of 2016, with domestic orders up 2% versus Q1 2016 and foreign buyers’ orders up 8%.

U.S. machine tool orders for the first half of 2017 have not been reported as yet, but through the first five months of the current year U.S. manufacturers’ new orders are valued at $1.67 billion, up 7.4% over the January-May 2016 total.

“Domestic demand … was a disappointment in the year’s first half,” according Dr. Wilfried Schäfer. This weak performance was largely due to a high rate of expansion during the first half of 2016, according to VDW, but that comparative effect is now diminishing.

“With the mid-year figures, we’re well on course of our expectations,” Schäfer said.  VDW noted that new orders for exports are rising, mainly from manufacturers in other European Union nations, whose new orders rose twice as fast as orders from the rest of the world.

Moreover, VDW restated its forecast of significant increases in machine-tool demand following the trend that started in 2016, driven primarily by automotive industry programs.

For its second-half 2017 forecast, VDW anticipates the new-order volume will be significantly better, reflecting business confidence indices, expanding industrial activity in Germany, and improving macroeconomic forecasts.

“Moreover, we’re anticipating a huge boost from the EMO Hannover 2017,” Schäfer concluded, referring to biennial machine tool and manufacturing technology expo that takes place in September.

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