Germany Machinery Sector to See Continued Decline in 2026, VDMA Warns
Outlook and Forecasts for Germany's Machinery and Equipment Industry
2026 Production Forecast and Industry Performance
BERLIN, Sept 17 (Reuters) - Germany's machinery and equipment industry is expected to shrink for a fourth consecutive year in 2026, with production forecast to fall 2% in real terms, the VDMA said on Thursday, cutting its earlier forecast of stagnation.
The downgrade reflects weak output this year, with production down 4.1% in the first seven months from a year earlier, despite signs that demand was improving.
Turning Point Predicted for 2027
However, the sector group said 2027 should mark a turning point, forecasting real production growth of 3%.
Improved Orders and Business Expectations
"The improved order situation and slightly brighter expectations suggest production will grow again in 2027," VDMA chief economist Johannes Gernandt said.
Price-adjusted orders rose 5% in the first seven months of 2026, driven by a 14% increase from non-euro zone countries. Business expectations have also improved.
Challenges Facing the Sector
Still, domestic demand remains weak and the recent pickup has yet to spread across the broader machinery sector, limiting the near-term production outlook, the group said.
(Reporting by Tom Kaeckenhoff, Writing by Friederike Heine; Editing by Thomas Derpinghaus)
