VDMA Monthly bulletin May 2016 | Volkswirtschaft und Statistik Monthly bulletin

VDMA Incoming orders in Germany Mechanical engineering | Volkswirtschaft und Statistik Monthly bulletin Strong growth thanks only to large-scale systems business In March, incoming orders exceeded the previous year’s level by an impressive 18 percent. This growth came entirely from abroad; domestic orders declined by 4 percent. By contrast, incoming orders from abroad increased by 29 percent. While demand from euro partner countries recorded growth of only 2 percent, orders from non-euro countries rose by 37 percent. However, this increase is mainly attributable to large-scale systems business, without which the incoming orders from non-euro countries would only have achieved a low level of growth. May 2016 Page 2 |

VDMA Production of German mechanical engineering | Volkswirtschaft und Statistik Monthly bulletin In 2015, production of machinery and equipment in Germany was 0.3 percent below the previous year. The forecast zero growth was therefore achieved. In the first two months of 2016, production increased by 2.6 percent. However, February also had one more working day than the same month of the previous year, which inflated the growth rate. The VDMA economists are forecasting stagnation for the year as a whole. May 2016 Page 3 |

VDMA Capacity utilization in German mechanical engineering | Volkswirtschaft und Statistik Monthly bulletin Capacity utilisation stood at 84.1 percent in April 2016, only just below the long-term industry average. The record low since 2011 was 83.6 percent in January The all-time high was reached in July 2011 at 89.9 percent. May 2016 Page 4 |

VDMA Employees in German mechanical engineering | Volkswirtschaft und Statistik Monthly bulletin With a total of million people on the payroll in February employment in the mechanical engineering industry has been as high as at the end of the year The change from February 2015 amounts to 0.6 percent. Year over year percentage changes have recently not been exciting: they ranged between 0.2 and 0.7 percent since April last year. The low in employment since 2011 was 909,000 people in January 2011; the record high was just under 1,019,000 in September May 2016 Page 5 |

VDMA German machine export | Volkswirtschaft und Statistik Monthly bulletin Exports of German machinery grew by a nominal rate of 2.1 percent year on year in February In the three-month period from December to February, which is more stable in statistical terms, there was a decrease of 0.7 percent. The euro zone posted growth of 3.1 percent, outflanking the EU-28 (up 1.8 percent). The growth drivers of the recent past (Poland and the UK) entered negative territory, but France recorded growth rates. Russia declined again slightly and is likely to be overtaken by Turkey. There were sharper downturns in Saudi Arabia (down 31.7 percent) and Brazil (down 34.8 percent). Trade with China (down 10.1 percent) is still faltering. The USA and Mexico posted growth of 4.3 percent and 16.7 percent respectively. There was good news from MENA, with a 56.8 percent increase in exports to Egypt. May 2016 Page 6 |

VDMA Incoming orders in Germany for selected subsectors | Volkswirtschaft und Statistik Monthly bulletin In the last three statistically documented months (January to March 2016), 12 of the subsectors accounted for separately in the VDMA’s incoming order statistics posted growth. Three subsectors achieved growth rates of 15 percent or more. These were foundry machinery, garment and leather technology and food processing and packaging machinery. However, power transmission engineering and machinery for metallurgical plants and rolling mills recorded downturns of 15 percent or more. May 2016 Page 7 |

VDMA Orders on hand in German mechanical engineering | Volkswirtschaft und Statistik Monthly bulletin The order backlog for the mechanical engineering industry was 5.8 production months in February An order range of just under six months is a good figure for the mechanical engineering industry, in view of an average throughput time of around three-and- a-half months due to reasons of technology. It shows that there are some order blocks here and there to ensure satisfactory levels of capacity utilisation, On the other hand, lead times and supply bottlenecks for customers are not likely to be a real problem. May 2016 Page 8 |

VDMA Business situation and expectations Manufacturing industry in Germany | Volkswirtschaft und Statistik Monthly bulletin The business climate index in the manufacturing industry improved again in April While industrial companies scaled back their assessments of the current situation slightly, they were also somewhat more optimistic again with regard to the months ahead. Production plans were adjusted upwards to a significant extent. May 2016 Page 9 |

VDMA Economic situation of German mechanical engineering | Volkswirtschaft und Statistik Monthly bulletin May 2016 Page 10 |

VDMA| Volkswirtschaft und StatistikPage 11 | May 2016 Contact. Dr. Ralph Wiechers VDMA Volkswirtschaft und Statistik Lyoner Str Frankfurt Phone Monthly bulletin