When the coronavirus pandemic broke out in Europe early this year, the economic impacts were almost immediately evident. Industries were hit hard almost across the board, including plastics and rubber machinery.
Yet the good news, at least according to the newest report from the Plastics and Rubber Machinery Association within Germany's VDMA trade organization, is that in terms of sales, 2020 has not been a complete write-off after all.
By mid-2020, the downward curve in sales and incoming orders had already started to flatten. By September, that downward trend showed signs of reversing itself, with incoming orders once again on the rise.
Ultimately, according to new figures released Dec. 11, a 3 percent year-over-year decline in incoming orders were posted between January and October 2020, a result mainly due to sales in September and October, Ulrich Reifenhäuser, chairman the VDMA plastics group, said.
"In September 2020, we had 13 percent more incoming orders compared to the same month of the previous year, and in October 2020, there were even twice as many orders on the books as a year ago," Reifenhäuser said.
That means the German plastics and rubber machinery sector is about to turn the corner, added Thorsten Kühmann, VDMA managing director. "Business is up and running again."
This conclusion also mirrors the development in foreign trade. Through May 2020, German monthly plastics and rubber machinery exports dropped to significantly lower levels compared to the same months in the previous year. However, these started to pick up in June, and by September, had not only caught up, but exceeded the export levels reported in September 2019.
The good news notwithstanding, the figures also show that in terms of sales, the plastics and rubber machinery sector has been less quick to recover. These are projected to be 10-15 percent lower in 2020 vs. 2019. Sales volume from January to October 2020 demonstrate a 14 percent decrease compared to the same period last year.
However, the association is looking forward to expected growth in sales of 5 percent in 2021, and 10 percent or even higher in 2022. If those predictions come through, the plastics and rubber machinery sector very likely returning to its pre-crisis level of 2019 by 2023, Kühmann said.