The industrial middle class has the first half of 2023 behind it and is slipping further towards the relegation zone.
“From January to June, production fell by 1.9 percent compared to 2022, four out of 14 sectors are in double-digit negative territory, every second company fears a further deterioration,” summarizes Holger Ade from the Steel and Metal Processing Industry Association (WSM).
The association speaks for around 5,000 mostly medium-sized industrial producers and calls on politicians to adopt a forward-looking, reliable, transparent strategy that gives companies security again.
“Our industries need, among other things, a barrier-free industrial electricity price that is accessible to all companies. And a growth opportunity law that brings real tax relief,” emphasizes WSM CEO Christian Vietmeyer.
Demand falls, challenges toxic
As the automotive industry comes back into play, its suppliers are left out. Demand is falling, just under 27 percent of the participants in a WSM survey consider their situation to be good, a quarter bad, and the other half say “satisfactory”. Only 7.8 percent are optimistic, while 47 percent of medium-sized industrial companies are concerned about the future.
“The cocktail of challenges is toxic: Politicians want to force and accelerate the transformation. It demands excessive reporting and verification obligations. And she does nothing to prevent energy costs from continuing to be too high. In order to turn the game around, those responsible have to start at these points,” emphasizes Holger Ade.
Confidence-building strategy against relegation
The second half of 2023 will decide a lot. The success of small and medium-sized industrial companies – key players in German prosperity – depends on political action: Steel and metal processing companies need an unhurried industrial electricity price for everyone. And they need the Growth Opportunities Act, for which the Federal Ministry of Finance has already submitted a draft. It aims at investment and innovation, tax simplification and fairness.
“Only with a confidence-building strategy can politicians protect medium-sized industrial companies from decline and keep them in place,” emphasizes Christian Vietmeyer.