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German tool and mould makers exceed expectations

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Medical, packaging industries strong

ETMM: Are there any other industries showing strong growth?

Heseding: Yes, the medical and packaging industries are certainly performing strongly at the moment with a healthy demand for moulds.

ETMM: What do you expect for 2015?

Heseding: For the current year we expect growth figures in the same ballpark as last year.

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ETMM: Manufacturing in the US is resurging. How is this market developing for local tool and mould makers and are there any other emerging markets?

Heseding: The US are still the number one export market, although exports did not reach the exorbitant 2013 results. Production and investment levels remained high, resulting in strong demand for tools. The Czech Republic has for the first time knocked China from the second position. In China, demand decreased and growth of investment slowed down. Other top export markets include the UK, Spain, Switzerland, Mexico and Poland.

ETMM: How are the developments in Europe?

Heseding: In Europe the situation is positive with increasing demand for tools from almost all important neighbouring countries, albeit at different rates. While Spain, the UK and Hungary provided significant contributions to growth, Poland and France only moved moderately, but in the right direction. An exception were sales to Switzerland, which remained unchanged in 2014, but monetary policy could provide a positive stimulus for the German toolmaking industry in 2015.

ETMM: How did domestic demand in Germany perform last year?

Heseding: German demand for tools and moulds from abroad increased only moderately in 2014 (3%), but the largest supplier to this industry, China, further expanded its leading position with an increase of 10%.

ETMM: The Russian market has very challenging long-term prospects. As a result, GM decided to pull its Opel brand out of Russia and mothball its St Petersburg factory by the middle of the year. What effects does the crisis have for the German precision tools sector?

Heseding: Exports to Russia already decreased by one third last year. Even though Russia and the Ukraine absorb only a small part of the German precision tool exports, there are individual tool and die makers, particularly in eastern Germany, who are affected by the crisis.

ETMM: What are the current challenges for tool and mould makers despite these positive sales figures and future prospects?

Heseding: Poor payment practices, i.e. long payment terms, are a huge challenge for many SMEs in this industry. Moulds can be very complex and hence expensive, so for small companies long payment terms can be very challenging. Automation is another topic and trend in the tool and mould industry. While it is getting harder and harder to find skilled staff, automating processes is a promising strategic option.

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