Negative situation for new orders

by Hans Diederichs


The global economy, weakened by trade disputes and political upheavals, was additionally hit hard by the COVID-19 pandemic. This is also reflected in the significant drop in orders in the mechanical and plant engineering sector. 

Mechanical engineering companies in Germany suffered a major decline in orders in the first six months of the current year. In the first half of 2020 incoming orders fell by 16 percent in real terms compared with the previous year. The decrease in orders from abroad was much stronger than the decline in orders from Germany. "This decline is attributable to a global economy weakened by trade disputes and political upheavals, which was additionally hit hard by the COVID-19 pandemic," explained VDMA economic expert Olaf Wortmann.

In June 2020, order intake in the German mechanical engineering industry fell by 31 percent in real terms. While domestic orders were down 12 percent, orders from abroad even dropped by 38 percent. "There is, however, a base effect that plays a role here: In June 2019, there was an enormous amount of large plant business in the orders from non-euro countries. The benchmark for year-on-year comparison is therefore extremely high," Wortmann summed up. Orders from non-euro countries decreased by 44 percent. From the euro zone, the mechanical engineering industry recorded a decline in orders of 14 percent.

In the three-month period from April to June 2020, the difficult situation for the mechanical engineering industry is also clearly visible. Orders dropped by 30 percent compared with the previous year. Domestic orders fell by 20 percent and foreign orders by 34 percent. Orders from the euro countries shrank by 24 percent, with 38 percent fewer orders arriving from non-euro countries.


Source: VDMA                           ]Photo: Shutterstock

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