German Automotive Industry Starts the Year with Optimism
The business situation for German automotive manufacturers and their suppliers improved significantly in January, finds the latest ifo Institute survey. In January, the indicator rose to plus 14.1 points, up from plus 3.4 points in December. Expectations are positive for the first time in five months, rising from minus 4.9 points in December to plus 10.7 points. “However, export expectations fell considerably,” says Prof. Oliver Falck, Director of the ifo Center for Industrial Organization and New Technologies.
Manufacturers rated their current business situation as significantly better. Their order backlog remained on a high level. “Automakers hope to be able to clear the backlog by expanding production in the coming months,” Falck says. These vehicles, however, are not intended for the international sales market. Automakers’ export expectations fell from 42.1 points in December to 2.1 points.
Among suppliers, optimism is returning only slowly. Assessments of the current business situation turned barely positive. In contrast, expectations rose sharply, but remain negative. Shortages of both intermediate products and skilled workers are still a problem, according to 55 percent of the suppliers surveyed.
