Orders received by the German machine tool industry in the third quarter of 2019 were 25% down on Q3 2018.

Orders from within Germany fell by 29%, and there were 23% fewer orders from abroad.

Orders received in the first nine months of 2019 fell by 23%, with domestic orders down 22% and foreign orders down 23%.

Wilfried Schäfer, executive director of the VDW (German Machine Tool Builders’ Association), said: “International demand for machine tools is continuing to decline, although the levels have recovered slightly just recently.

"Never before has the industry been confronted by such an accumulation of factors, all of which have had a negative impact on business — a cyclical downturn coupled with trade conflicts and instability in the largest customer, the automotive industry.

“Compared with the summer months, however, the volume has recently stabilised somewhat for metal-cutting machines, which account for around 70% of total machine tool production.

"We are seeing the first ‘EMO effects’, although it remains to be seen whether this will stabilise in the coming months.

"Order levels for forming machinery even rose again in September, thanks to foreign projects in particular.

“Overall, order levels from the euro-zone are a source of worry, and Oxford Economics — VDW’s forecasting partner — does not expect any appreciable recovery in demand from Europe for the year as a whole.

“Asian business is also giving the experts cause to worry.”

Against this backdrop, VDW (www.vdw.de) has lowered its production forecast for 2019.

In view of the sharp drop in orders in the current year, it will no longer be possible to maintain the predicted moderate decline in production.

The association is now assuming a decline of 4%, with even this figure being supported by the clearing of the order backlog . . . The real problem will come in 2020, when the backlog of orders has been cleared.