Germany’s foundry industry is cutting back on investments and expects drastically falling sales in 2020. Whether the recession will affect employment will probably also depend on the extension of short-time working compensation and the performance of the vehicle manufacturing industry.

Since March 2020 (first survey), the BDG has been surveying its member companies on a monthly basis during the corona crisis, thus exclusively and systematically collecting data on the German foundry industry. The basic framework of the same questions is supplemented according to the situation. The June survey focused on employment, sales development and the evaluation of the economic stimulus package.

From the point of view of German foundries, the issue of capacity adjustments has also become slightly more acute. When asked about this, 85% of the companies surveyed said yes (previous month: 81%). Short-time work is listed as an instrument (81%, previous month 77%). While production stops (33%, previous month 46%) have declined slightly, staff cuts could gradually become an issue for entrepreneurs. Here, the approval rate for the question rose from 29% to 34%.

That this aspect is gradually moving into focus is not surprising given the further assessment of the current year 2020. For example, only a minority of 6% of the companies surveyed expect stable to slightly rising sales for the current year, while 93% expect sales to fall, of which 92% expect a decline of more than 10%.

The findings are similar when it comes to the question of investments. Only a minority of 25% intend to stick to the investments planned for 2020 as things stand at present. The overwhelming majority of foundries want to cut back massively. 38% of the foundries surveyed forecast at least a halving of the planned investments.