But prospects are brightening
According to an Ifo survey, the business of German car manufacturers and their suppliers is rather average to poor. In January, the assessment of the current situation rose only slightly to minus 7.5 points, after minus 8.5 points in December, as the researchers announced. In contrast, expectations of future business improved slightly to plus 11.6 points, after plus 11.2 points in December.
“The carmakers are cautiously optimistic that demand will pick up again after the lockdown. The stocks are currently being refilled for this too,” said Ifo expert Klaus Wohlrabe.
Production has therefore recently declined slightly and should tend to be kept constant over the next three months. “At the moment, companies do not expect any further impulses from foreign business. The industry will continue to cut jobs,” said the Ifo Institute. The job indicator therefore rose only slightly to minus 33 points. The second lockdown has slowed the demand dynamic significantly. Nevertheless, the order cushion increased. The stock in the finished goods warehouse is slightly larger than usual for the time of year.
The companies were asked why they were restricting their production: only 16 percent said they had too few orders. In January 2020 it was 26 percent and in April 61 percent, as the Ifo announced. “The capacities are used to 84 percent.” In April 2020 with the first lockdown, the load had fallen to 46 percent.
