A Small Dent in the German Automotive Industry’s Business Climate
The business climate in Germany’s automotive industry deteriorated slightly in February after a noticeable brightening in January, according to the ifo Business Survey. “However, with a value of -10.1 points, the industry index is still well above where it was when it bottomed out in 2023,” says Anita Wölfl, a specialist at the ifo Center for Industrial Organization and New Technologies.
The business climate has deteriorated solely due to less optimistic expectations for the next six months. That indicator fell to -30.0 points in February, down from -24.3 points* in January. In contrast, assessments of the business situation remained virtually unchanged at 12.2 points.
“The automotive industry has now almost cleared the order backlog that started building up in 2021 due to supply chain problems,” Wölfl says. This can be seen in the data from Germany’s Federal Statistical Office. Another finding from the ifo Business Survey is that, looking at the average across all companies, the order backlog is now sufficient for another 5.6 months; this is two months less than in 2022, but still one month longer than the long-term average.
*Seasonally adjusted
