The current business situation of German car manufacturers and especially theirs suppliers has improved according to the Ifo Institute. In May, the indicator rose by around five to 28.4 points, the Munich economic researchers said on Monday in a survey. “However, the development of the data points to a turning point, because the expectations for the coming months are consistently pessimistic,” said Ifo industry expert Anita Wölfl.
Unlike in industry as a whole, the German automotive industry their current business situation therefore remains positive. The situation for car manufacturers improved in May to 27.5 points after 23.8 points in April and for suppliers even to 43.1 points after 35.1 points.
“The assessment of the profit situation is particularly striking,” said Wölfl. The supplier companies, for example, gave positive reasons for their earnings situation for the first time in two years. “This is gratifying, since a solid profit situation is important in order to be able to cope well with the challenging transformation process in the industry.”
International competition is worrying the auto industry
However, companies are pessimistic about the coming months. In the automotive industry as a whole, business expectations fell to minus 14.1 points in May – “and thus finally negative after they had just been positive since the beginning of 2023.”
The companies see the international competitive situation as a particular challenge. According to the Ifo survey, car manufacturers and suppliers see themselves relatively well positioned in Germany and in the EU, but their competitive position outside of Europe is clearly negative. Here, Wölfl points to the strength of Chinese manufacturers of electric vehicles, which are also increasingly penetrating the European market.