Turn of the year - Südwestmetall sees industry facing major challenges
Südwestmetall boss Joachim Schulz is forecasting a difficult year for the metal and electrical industry. "The forecasts for 2024 are only slightly better, the mood in many of our companies is rather depressed," Schulz told the German Press Agency in Stuttgart. Urgent investments in future technologies and the promotion of innovation are now also being called into question due to austerity measures in the federal budget. Should these fail to materialize, the latest forecasts even predict further stagnation or a renewed contraction - both for the economy as a whole and for the metal industry, according to Schulz.
"But I am an optimist and always hope that the forecasts will be exceeded," said Schulz. At the end of October, 987,300 men and women were employed in the industry in the southwest. This is around two percent below the peak levels of 2019, but around 18 percent above 2010, according to the association. Association head Schulz does not expect a major wave of insolvencies in the near future. In the industry, less than one percent of businesses are affected by the opening of insolvency proceedings each year.
The head of the association explained that the tension in the industry will remain high. The transformation of the automotive industry is in full swing, which is creating massive pressure for change. Digitalization and new technologies such as artificial intelligence meant technological leaps in which companies would have to make a huge effort to remain at the forefront internationally in the future. "Above all, all of this requires considerable investment. However, these are made more difficult by difficult framework conditions here in Germany, such as high energy costs, too much bureaucracy and an increasing shortage of skilled workers."
The crucial question will therefore be how to improve these framework conditions so that companies can invest in the future here at the location and thus secure employment. "Many of the lamented conditions are nothing new, they have just been masked by the positive economic development with low interest rates and low inflation."
Schulz warned against the relocation of production from the southwest to other countries. The companies are deeply rooted here and basically want to continue producing here in the future and secure jobs. "When deciding where to manufacture a successor product, they have therefore always accepted certain cost disadvantages here in the past and tried to compensate for this with other improvements."
However, there is a big difference between, for example, being able to continue producing a successor model with the existing production facilities - with certain adjustments - and needing completely new facilities due to technological leaps. "Then it is far less certain that the follow-up production will remain here in Germany or Baden-Württemberg." Such changes are being experienced across the board in the industry.
Südwestmetall
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- Despite the challenging forecasts for 2024, Südwestmetall boss Joachim Schulz remains optimistic, expressing hope that the industry in Stuttgart, Baden-Württemberg, and Germany as a whole will surpass the expectations set by the current predictions.
- The metal and electrical industry in the southwest of Germany employs approximately 987,300 men and women, with a workforce that is slightly below its 2019 peak levels but significantly higher than in 2010.
- Schulz highlighted that the transformation of the automotive industry is placing immense pressure on companies in the metal industry, necessitating significant investments in future technologies and innovations to remain competitive globally.
- The challenges faced by the metal industry in Germany include high energy costs, excessive bureaucracy, and a growing shortage of skilled workers, all of which contribute to making the necessary investments in the future more difficult.
- The key question moving forward is how to improve the operating environment for companies in the southwest, enabling them to invest in the future and secure employment in the face of these challenges.
- Schwulz cautioned against the relocation of production to other countries, emphasizing that many companies in the metal industry are deeply rooted in the region and are striving to continue manufacturing there, maintaining jobs and future growth.
Source: www.stern.de
