The Italian Machine Tool Market

EMO took place from 18 to 23 September in Hannover. This is the most important European-wide trade fair for machine tools. It is a biennial fair that takes place alternately in Germany and Italy, in those countries that are both the two major producers and the two main markets for machine tools in Europe.

Data on the Italian market

On this occasion data were published by UCIMU, the Italian association of machine tool makers, relevant both to production and to internal market.

This data not only confirms the exit from the decade’s economic crisis that took place but also provides an  optimistic outlook for the machinery market in the coming years.

The market grew by 18.6% from 2015 to 2016. This is the largest growth among the top eight countries in the world:

market growth 2016 vs 2015  market size 2016 (M€) 
China -0.2%                          24,772
USA +0.4%                             8,024
Germany +6.3%                             6,160
Japan +11.5%                             4,625
Italy +18.6%                             3,183
South Korea -7.7%                             3,180
Mexico +7.9%                             2,173
India +11.5%                             1,731

Production increased by 6.4% and, to meet the domestic demand, exports dropped by 4%.

The trend of production continues to increase and the utilization of production capacity has increased from 75% in the fourth quarter of 2015 to 83% in the second quarter of 2017.

Orders received by Italian producers in 2017 are 9.9% higher than in 2016, with a 5.6% increase in orders from overseas and 24.8% on domestic orders.

Interpretation of data and forecast

UCIMU, representing Italian builders in the government and in the political world, gives – indeed – great importance to the positive investment impact of a governmental initiative called “Industry 4.0”, which alleviates the tax burden for the companies that invest in automation.

This is certainly a factor, but I do not think it is the dominant one. Much has to do with the general situation of the world economy, but above all on an all-Italian phenomenon. Most metal working companies are in the hands of individuals or families. In the years of the crisis only the performing companies have resisted and continued to build up profits. In the general uncertainty situation, these were not used, but were set aside.

Once emerging from the crisis and with a market that requires more technological content from the pre-2008 years, industrial families have to invest, and also have the means to do so, often without having to draw on credit.

The growth of the Italian market will continue in the medium term, though not in double figures. Oxford Economics (consulted by UCIMU) estimates growth in the Italian market for 2017 to + 10.6% against +3.6% in Europe, +3.5% in the world and foresees a more moderate growth for the next two years.

Author: Michele Schweinöster

International manager with deep understanding of consumer durable goods and of machinery, functionally expert in the areas of service, logistics and sales.

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