Economy: Mechanical engineering cuts forecast

The decline in production in German mechanical engineering this year is greater than previously expected. Instead of a two percent decline, the industry association VDMA now anticipates a five percent drop. "VDMA economists expect a slight recovery in the mechanical engineering sector in 2026 – provided the autumn reforms announced by politicians actually take effect," said VDMA President Bertram Kawlath on Tuesday at the Mechanical Engineering Summit in Berlin. Production in the industry, which employs around one million people, is expected to increase by one percent in 2026.

Wars and trade wars, political paralysis, and unsettled investors have left clear marks on the export-oriented mechanical and plant engineering sector. Companies are angry that reforms are only promised but not implemented quickly enough. Trade wars are being fought at the expense of companies. Regulations primarily lead to rampant bureaucracy. At the same time, the growing number of wars is causing uncertainty among companies.