Germany's machinery manufacturers, one of the country's leading industrial sectors, warned on Tuesday that 2025 could be a turbulent year due to Donald Trump's return to the White House, growing competition from China and political uncertainty in Berlin.
With flagship groups such as Siemens, Thyssenkrupp and Trumpf, alongside myriad SMEs, the sector is particularly hard hit by the difficulties of Europe's leading economy, which is on the brink of recession.
Production in the sector is expected to fall by 8% this year and by a further 2% in 2025, according to forecasts by industry federation VDMA.
"If we look to the United States, our main export market, we expect the Trump 2.0 era to be undoubtedly more disruptive than his first term," VDMA President Bertram Kawlath said at a press conference in Frankfurt. The main concern here is about the promised across-the-board increases in customs tariffs, which could hurt Germany, a major exporting nation.
Competition with Chinese companies will also "continue to intensify, not only in China, but also in third markets, as well as in Germany and Europe," according to Mr Kawlath.
This competition is taking place against a backdrop of massive subsidies provided by the government in Beijing for Chinese companies, as a VDMA investigation showed in July.
Local authorities are also putting pressure on Chinese companies to source local equipment.
The "uncertain" economic situation will have an impact on employment in a sector that employs nearly a million people.
Some 60% of the companies surveyed by the VDMA are forecasting a decline in staff numbers over the next 12 months. Only 20% expect an increase.
