Material Shortages Ease in German Manufacturing
Material shortages in German manufacturing are slowly dissipating. In March, 41.6 percent of the companies surveyed reported problems, down from 45.4 percent in February. This is a finding from the ifo Institute’s latest survey. “This easing will have a positive impact on industrial production in the months ahead,” says Klaus Wohlrabe, Head of Surveys at ifo. “But we’re still a long way from an ideal supply situation.”
A fundamental reduction in procurement barriers in some of Germany’s key manufacturing industries has not yet taken place. More than 60 percent of manufacturers of machinery and equipment, electrical and electronics companies, and automakers reported bottlenecks in raw materials and intermediate products. “A habituation effect has certainly set in here,” Wohlrabe says. “Companies have learned how to deal with the ongoing shortage.”
In the leather goods industry, no company reported material shortages – the first time this has happened since January 2020. In the paper industry, the figure was down to just 2.4 percent.
