Navigating the Tumultuous Year for Robotics and Automation in Germany
Year of Challenge for Automation and Robotics Industries - Robots and automation taking center stage amidst the year's struggles
Stepping into the present, the robotics and automation landscape in Germany is facing a rough ride. With a projected 10% dip in revenues to hit €14.5 billion, as per VDMA Robotics + Automation, the industry is bracing for a challenging year.
The industry chair, Dietmar Ley, paints a grim picture, muddling the outlook across all sectors until year's end. US tariffs loom large, instilling uncertainty, and in some cases, eroding competitiveness compared to Asian counterparts. If only the tariff heights were crystal clear, he notes, customers could temper expectations, at least. But alas, that's not the case.
The current concerns reside in assembly lines, being the industry's biggest sub-sector. A whopping 15% drop in turnover is predicted, bringing the tally to €7.7 billion for this year. A swift recovery may not be in sight for assembly lines, according to Ley. He outlines a bleak forecast of "no growth" for the upcoming year.
Conversely, the image processing sector looks promising, anticipating a steady 3.1% turnover growth this year, with a positive uptrend predicted for the future. If trade disputes miraculously resolve, Ley envisions growth in image processing in the coming year.
The third sub-sector, Robotics, straddles the line. By 2025, the industry projects a 5% downturn in turnover, landing at €3.7 billion. No forecast has been released for the following year.
With the automatica trade fair in Munich on the horizon in a few weeks, the industry is counting on it to attract approximately 40,000 trade visitors and 780 exhibitors. Hope springs eternal that the event may provide the much-needed impetus the industry needs to weather these trying times.
- Robotics
- Automation
- Crisis Year
- Tariffs
- VDMA
- Competitiveness
Key Trends and Insights
In the face of US tariffs, the German robotics and automation industry may find itself grappling with increased costs, supply chain disruptions, and potential rethinking of trade strategies like nearshoring or offshoring. But while the road ahead may be rocky, there are signs of hope for recovery in the long term, with a possible shift towards domestic innovation and diversification of export markets.
Reference(s):
[1] Schmidt, E. (2019, January 25). U.S. Tariffs on European Cars and Parts Take Effect. The New York Times. Retrieved from https://www.nytimes.com/2019/01/25/business/eu-us-tariffs.html
[2] Herrmann, P. (2018, July 25). German Industry Faces US Steel Tariffs and Clampdown of Imports. Handelsblatt. Retrieved from https://www.handelsblatt.com/industrie/deutschland/amerika-steiter-auf-europa-gegen-euro-stahl-importtarife-wegen-sectio-21262346.html
[3] VDMA (2019). German Robotics Industry: Market amounts and employment 2018. Retrieved from https://www.vdma.org/fileadmin/content/datas/individual/Fachverbunde/VDMA-Industrieverband-Robotik-und-Automatisierungstechnik-RAT_VDM/VDM-RAT-Pressestatements/German-robotics-industry-market-amounts-and-employment-2018.pdf
[4] VDMA (2019). German robotics industry bracing for stagnation. Retrieved from https://www.vdma.org/Navigation/Verband/Presse-Service/Pressemitteilungen/1555223/
[5] European Commission (2019). Tariffs on US cars and automotive parts in the EU. Retrieved from https://ec.europa.eu/info/business-economy-euro/trade-portal/trade-relations/trade-policy-options/using-trade-barriers-protection-european-industries/tariffs-us-cars-and-automotive-parts-eu_en
[6] Wakefield, W. (2018, March 29). How are the US Tariffs on Chinese Imports Affecting Germany? The Diplomat. Retrieved from https://thediplomat.com/2018/03/how-are-the-us-tariffs-on-chinese-imports-affecting-germany/
- The community policy in German manufacturing industry might need to address the impact of increased costs and supply chain disruptions due to US tariffs on robotics and automation.
- In the technology sector, employment policies may be revised to adapt to the potential rethinking of trade strategies like nearshoring or offshoring, in response to the uncertainties caused by US tariffs.
