Sectors and Resources
The Sector Research team analyses cyclical and structural developments. On the basis of its findings it draws up business and policy recommendations for the major sectors. These include the important branches of industry as well as wholesale/retail, services, energy, transportation and environmental policy.
Industrial sector
The industrial sector's share in the EU economy is stabilising
Nearly four years ago, the European Commission set its sights on increasing the share of manufacturing in total gross value added from 15.5% at that time to 20% by 2020. This target will probably not be met. After all, in 2015 the share of manufacturing was only around 15.6% and thus scarcely higher than in 2012. However, industry's contribution to EU output has at least stopped decreasing since 2012. Furthermore, industrial gross value added has picked up (slightly) in the EU in recent years in both nominal and real terms. In a few member states, there have been highly contrasting developments in the significance of manufacturing in the economy. It is striking that the industry share in the three large Eastern Europe member states has increased sharply since 2012. Spain and Italy have reported modest gains. Germany has seen its industry share decline slightly in 2015; however, at 22.8% it still far outstrips the EU average. [more]
Fewer insolvencies in German industry
The 2008/2009 economic and financial crisis caused the number of insolvency proceedings instituted to increase by 48% in 2009 alone. However, the number of insolvencies has been following a downward trend since then. As a result, fewer proceedings were instituted in 2015 than in 2008 across nearly all sectors of industry. The prospects for this trend continuing in 2016 are good. Over the past few years, the number of insolvencies in any given industry has been significantly influenced by the prevailing economic conditions in that industry and – related to this – the value of the euro against the currencies of major trading partners. [more]
German industries
Brexit: German automotive and pharmaceutical industries hit the hardest
Following the UK referendum, Brexit will also leave traces on German industry. After all, 7.5% of all German exports went to the UK in 2015, making it Germany’s third most important export market after the United States and France. The automotive and pharmaceutical industries are likely to be hit the hardest by Brexit. This is because the UK accounts for 12.8% and 10.5%, respectively, of these two industries’ total exports. In addition, they both generally have an above-average export ratio. The UK referendum is likely to have an impact on individual companies’ investment decisions and German companies’ UK pricing structures in the short term. [more]
German manufacturing
German manufacturing output: a good first quarter, but no stable uptrend
Following a strong increase in manufacturing output in Q1 2016, we have raised our forecast for the entire year 2016 to 1% (previously, a marginal increase). Hardly anything has changed in our forecast of generally moderate performance in the manufacturing sector for 2016 as a whole. However, the strong start to the year requires upward adjustments to our forecasts, also at sector level. These are particularly noticeable in the automotive and plastics industries as well as among producers of building materials. [more]
Natural resources
German ‘Energiewende’: Many targets out of sight
Many of the environmental-performance targets of the German ‘Energiewende’ are in fact falling behind the time scale that is actually required – some of them are significantly behind schedule. Progress is largely achieved where major subsidies are provided via some form of support programme. Where there is no such support, or subsidies and incentives are small, or too small, targets are starting to be missed. One criticism is that no quantifiable targets have been drawn up in the areas of economics/efficiency and security of supply. If the current status of the ‘Energiewende’ had to be described in one sentence, it might be that Germany has probably taken on too much in too short a time. We believe there are four main limiting factors: cost, physical limits, the available time budget and political feasibility. [more]
Diesel share
Diesel share in EU declined in 2015, but only slightly
Last year, the proportion of diesel cars among new car registrations in the EU-15 dropped by 1.5 percentage points to just over 52%. This was the fourth decline in a row. The fall in the diesel share was especially pronounced in France, where the government wants to reduce the tax advantage for diesel over petrol. By contrast, in Germany the diesel share increased slightly last year, due among other things to the large number of commercial car registrations. We expect a further decline in the diesel share in the European car market over the next few years. The higher costs for diesel technology play a role here. However, for high-mileage drivers in particular, the lower consumption and long range of diesel cars as well as lower fuel prices remain convincing sales arguments. Therefore, provided governments do not introduce any serious surcharges for diesel cars, the diesel share of the European car market is unlikely to crash. [more]
German GDP; Fiscal balance; Current account surplus; Retail investors; German industry; View from Berlin
German industry, mortgage lending, German housing and office market, view from Berlin
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