Germany has been in a serious economic downturn for some time now, which of course has its effects on further industries. The sector that is obviously closest to us, i.e. automation, is suffering badly. In the first quarter of 2024, the industry's revenues amounted to €11.5 billion, down 1.5 per cent on the previous year.
Nothing happens without a reason
The drop in revenue is due to weak demand for the automation industry's products and services. The main factors contributing to the decline in demand are:
The economic crisis: Due to the economic crisis, companies are investing less in new technologies, including automation.
War in Ukraine: The war in Ukraine is having a negative impact on the European economy, which in turn is affecting demand for automation industry products and services.
Supply chain problems: Supply chain problems are making it difficult for companies to access the components needed to produce automation products and services.
Companies face increasing problems
Declining revenues are having a negative impact on the financial situation of automation companies. Many companies are reporting losses or profits at low levels. In extreme cases, this can in turn lead to large-scale redundancies or even the closure of the most problematic companies.
In this case, unfortunately, we are dealing with a ‘cumulative effect’. The problems of the German economy affect the automation sector, and further companies on the brink of survival only make the overall situation in the country worse.
Mixed feelings
The outlook for the future of the automation industry in Germany is mixed. On the one hand, the industry has potential for growth, as automation is a key technology for Industry 4.0. On the other hand, the industry faces challenges from the economic crisis, the war in Ukraine and supply chain problems.
