Import delays due to customs disagreement affect April shipments: April's machinery deliveries impacted by customs disagreement
A Tough April for Germany's Machine and Plant Manufacturers: The Escalation of Trade Disputes Leads to a Drop in New Orders.
It's a bumpy ride for the German machinery and plant manufacturing industry, as the ongoing trade disputes are causing some serious headaches.
In April 2025, the industry, as represented by the VDMA (German Mechanical Engineering Industry Association), faced a 6% drop in new orders compared to last year. To put things in perspective, that means for every $100 worth of orders last April, they only gained $94 this April, after adjusting for price increases.
The ongoing feud with the United States is one of the major factors contributing to this decline. The relentless trade threats and tariffs proposed by the current US administration have sent shockwaves through the industry, causing a significant dip in both domestic and foreign orders – with a 4% and 7% drop, respectively.
This tumultuous environment is far from alien to the industry, which remains particularly vulnerable to trade tussles, especially with Asia being one of their primary markets. Notably, machinery exports to Asia plummeted by 20% in the first quarter of this year, signaling a troubling trend.
Johannes Gernandt, the VDMA's chief economist, comments on the ongoing uncertainty: "The world is experiencing high levels of uncertainty, which is causing a reluctance to invest." The industry's outlook remains cautious, with only a 1% increase in orders for the first four months of the year compared to last year.
The VDMA isn't just sitting by and watching; they're speaking up. The announcement of a fiscal investment program by the German government is seen as a positive step, offering potential investment incentives for the sector. Moreover, the VDMA advocates for engaging at the policy level and within industry networks to address these immediate disruptions and future strategic challenges.
In other words, it's a case of fight or flight. The industry is calling for quick action from the federal government to strengthen Germany's manufacturing location and ensure its long-term survival in an ever-changing global market.
Tabulated Summary
| Issue | Impact (April–Q1 2025) | VDMA/Industry Response ||---------------------|--------------------------|-------------------------|| US-led trade disputes| 6% drop in order intake (April) | Advocating for fiscal incentives, adaptation strategies || Decline in Asian exports | 20% drop in machinery exports (Q1) | Advocating for policy intervention || Ongoing tariff threats | Persistent uncertainty, investment lag | Stressing the need for strategic adaptation |
The manufacturing sector is at a critical juncture, with trade disputes posing a serious threat to their orders. The VDMA is calling upon the German government to take immediate action and the industry to adapt and evolve in this intensifying global market.
With the ongoing trade disputes negatively impacting their orders, the German machinery and plant manufacturing industry is seeking financial incentives from the German government to secure their long-term survival. Concurrently, the industry is advocating for policy engagement to combat immediate disruptions and future strategic challenges, particularly in light of the 20% drop in machinery exports to Asia during Q1.
