A group representing Germany’s machinery industry yesterday said that it expects production to drop 17 percent this year as the sector struggles with the fallout from the COVID-19 pandemic and international trade tensions.
Orders for machinery, a major German export, were down 16 percent in the first seven months of the year compared with a year earlier, while production declined 14 percent, the Mechanical Engineering Industry Association said.
The association cited the effects of the pandemic, protectionism in international trade and change affecting the auto industry — a key customer.
Official data released yesterday showed that Germany’s overall exports were up 4.7 percent in July compared with the previous month.
That was the third consecutive month-on-month gain following huge declines at the height of Europe’s COVID-19 lockdowns — but a much smaller increase than the 14.9 percent seen in June. In year-on-year terms, exports fell 11 percent.
That is in line with recent data showing that increases in German factory orders and industrial production also slowed in July.
The government last week said that the economy was performing better than expected following the easing of Germany’s lockdown restrictions, which were less drastic than in some other European countries.
It is now predicting that the economy would contract 5.8 percent this year, a somewhat more optimistic outlook than the 6.3 percent it forecast in late April.
AUTO INDUSTRY
Germany’s struggling auto industry needs more government aid, including a purchasing bonus for less-polluting combustion-engine vehicles, to help weather the pandemic, German Minister for Transport, Building and Urban Development Andreas Scheuer said.
The number of electric vehicles available is limited and there are combustion-engine models on the market that are relatively clean in terms of air pollution, Scheuer said in an interview with DLF radio yesterday.
“We are talking about a key German technology and many, many jobs and families depend on it,” Scheuer said, ahead of talks later yesterday chaired by German Chancellor Angela Merkel between government officials, regional leaders and auto executives on the future of the industry.
Merkel’s ruling coalition is divided over the need for a purchasing incentive for combustion vehicles, with Scheuer’s party — the Bavaria-based Christian Social Union — arguing in favor and others insisting that the focus should be on promoting electric vehicles.
Merkel last week said that she was aware of the CSU’s position, but saw no need to expand the government’s stimulus package for the time being.
Germany has already sought to lift auto sales by introducing purchasing subsidies of as much as 9,000 euros (US$10,632) per electric vehicle.
Scheuer, who was to attend yesterday’s “car summit,” said that more government support was needed to help automakers and parts suppliers cope with the fallout from the pandemic.
Additional reporting by Bloomberg
Alibaba Group Holding Ltd (阿里巴巴) founder Jack Ma (馬雲) has been living in Tokyo for almost six months after disappearing from public view following China’s crackdown on the tech sector, the Financial Times reported yesterday, citing multiple unnamed sources. The billionaire has kept a low profile since the crackdown, which has included Chinese regulators scrapping the initial public offering of Ma’s Ant Group Co (螞蟻集團) and issuing Alibaba with record fines. However, the Times said he has spent much of the past six months with his family in Tokyo and other parts of Japan, along with visits to the US and Israel. The
FACTORY TUMULT: The departure of new workers impact production less than the quarantines imposed on existing employees, a worker at China’s ‘iPhone city’ said Turmoil at Apple Inc’s key manufacturing hub in Zhengzhou is likely to result in a production shortfall of almost 6 million iPhone Pro units this year, a person familiar with assembly operations said. The situation remains fluid at the plant and the estimate of lost production could change, the person said, asking not to be named discussing private information. Much depends on how quickly Hon Hai Precision Industry Co (鴻海精密), the Taiwanese company that operates the facility, can get people back to assembly lines after violent protests against COVID-19 restrictions. If lockdowns continue in the weeks ahead, production could be set further
‘REVOLUTION’: Elon Musk complained over a 30 percent fee Apple collects on Apple Store transactions and said the technology company has stopped advertising on Twitter Twitter Inc owner Elon Musk on Monday opened fire against Apple Inc over its tight control of what is allowed on the App Store, saying the iPhone maker has threatened to oust his recently acquired social media platform. Musk also joined the chorus crying foul over a 30 percent fee Apple collects on transactions via its App Store — the sole gateway for applications to get onto its billion-plus mobile devices. A series of Twitter posts fired off by Musk included a meme of a car with his first name on it veering onto a highway off-ramp labeled “Go to War,” instead
‘COMPETITIVE EDGE’: The local semiconductor sector would continue to outstrip the global industry, whose revenue is expected to contract 3.6 percent, ITRI said The production value of Taiwan’s semiconductor industry would expand 6.1 percent annually to about NT$5 trillion (US$161.5 billion) next year, as demand for advanced chips used in high-performance-computing and artificial intelligence devices are less prone to mounting inflation and external uncertainties, the Industrial Technology Research Institute (ITRI, 工研院) said yesterday. That means the local semiconductor sector would continue to outstrip the global semiconductor industry, whose output is expected to contract 3.6 percent annually to US$596 billion next year, Gartner Inc has said. However, ITRI’s latest forecast represents a downgrade from its previous projection of 10 percent growth, as demand for PCs,
RSS