The European machine tool sector is showing resilience in 2024, according to the European Association of Manufacturing Technologies (CECIMO). Despite political and economic uncertainties in the region, which caused orders to temporarily decrease in early 2024, the sector is expected to recover. Better economic indicators and decreasing inflation are likely to drive an increase in orders in the latter half of this year.
In 2024, consumption levels are expected to decrease by 1.8%. Initial statistics show a 5% decline in production levels compared to 2023, reflecting the broader economic challenges and market adjustments facing the industry.
In 2023, Italy achieved a new production record for machine tools, robots, and automation systems. According to the Italian manufacturers' association for machine tools, robots, automation systems, and ancillary products (UCIMU), Italian production reached $8.3 billion, showing a 4.6% increase from 2022. This growth was mainly due to exceptional performance in foreign markets. Exports in 2023 increased by 21.8% year over year, reaching $4.6 billion, while consumption decreased by 7.8% to $6.32 billion. Domestic deliveries dropped by 11% to $3.7 billion, and imports fell by 3% to $2.63 billion.
The main export markets for Italian machine tools in 2023 were the United States ($615 million, an increase of 17.5%), Germany ($389.93 million, an increase of 17.2%), and China ($310 million, an increase of 26.6%). Other significant markets included France, Poland, Turkey, Mexico, Spain, India, and the United Kingdom, with Mexico showing an impressive growth of 133.1%.
In the first half of 2024, order collections dropped 17.3% compared to the same period the previous year. Domestic orders fell by 18.7% and foreign orders by 16.2%. This decline is attributed to global and domestic instability.
In early 2024, Germany's machine tool sector saw a notable decrease in orders, partially influenced by the high order levels at the beginning of 2023, according to the German Machine Tool Builders’ Association (VDW). Although there is currently a downturn, signs indicate a stabilization, and there is potential for improvement in the latter half of the year.
Lower inflation, decreased energy prices, expected interest rate increases, the end of destocking, and enhanced economic indicators may lead to increased investment. Higher real incomes, which stimulate consumption, are also projected to contribute to this recovery.
In 2023, the machine tool industry in France saw increased activity, driven in part by orders that had been postponed from 2022 due to disruptions in the supply chain caused by the pandemic, according to the French trade organization EVOLIS Symop. The first half of 2024 shows promise, although manufacturers are still exercising caution in their outlook for the rest of the year.
In the coming years, several client sectors in France are expected to continue making investments in machine tools, with the aerospace sector projected to lead the way with an average annual investment increase of 5.09%, followed by metallurgy at 2.64% and precision instruments at 2.41%.
Preliminary data suggests that machine tool sales in France saw increases in both value (up 8.07%) and volume (up 1.99%) in 2023. The aerospace sector remains the largest client, accounting for 30% of sales, followed by general mechanics (20%) and the automotive sector (12%).
A few recently announced projects and investment news items are listed below.
Rheinmetall has received a major order from the Ukrainian government to build an ammunition factory in Ukraine. The order is valued in the low three-digit million-dollar range and includes complete technical equipment and commissioning. Ammunition production is set to begin within 24 months, and the project is expected to be completed within a few years.
Safran Helicopter Engines and MTU Aero Engines have signed a cooperation agreement to establish a joint venture called EURA in France. The joint venture will focus on developing a new heavy helicopter engine for European military helicopters set to enter service by 2040.
Stellantis has recently opened a new electric vehicle production line in Kragujevac, Serbia. The facility will manufacture the new Fiat Grande Panda model and symbolizes Fiat's shift toward a global multi-energy platform. This project is part of a $206-million investment by Stellantis and Serbia.
The BMW Group will establish new high-voltage battery plants in Irlbach-Strasskirchen, Debrecen, Woodruff, Shenyang, and San Luis Potosi. The first Neue Klasse vehicles will be made in Debrecen starting in 2025, with high-voltage battery and vehicle manufacturing launching in parallel.
French carmaker Renault and the government of Slovenia have signed a memorandum of understanding to produce a revised version of its Twingo electric vehicle at the Revoz plant in Novo Mesto. Production is set to begin in 2026, with an initial annual output of 150,000 vehicles.
U.S. manufacturer Maxcess has opened its main European manufacturing plant in Falkowo, Poland, after investing $15 million in the project. The new factory spans 13,500 square meters, doubling its workforce, and the company plans to extend the factory by an additional 30%-35% in the future.
Samsung Electronics Poland Manufacturing has completed the development of a modern factory in Wronki, Poland, which will increase the annual production capacity of the existing household appliance factory by over 30%. The new facility will utilize advanced automation solutions throughout the entire production line.
For more information, please contact Conchi Aranguren at caranguren@AMTonline.org.
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