European farm machinery climate ‘remains deeply negative’
The European agricultural machinery industry “remains deeply negative”, with the impact of Covid-19 being keenly felt.
That’s according to CEMA – the association of European (agricultural) machinery manufacturers.
CEMA notes that, since the onset of the pandemic around Europe, its ‘business climate index’ has dropped as sharply and as deeply as it did during the 2008/2009 financial crisis.
Over half of industry representatives consider their current business to be unfavourable, while three-quarters expect a declining turnover in the coming six months, the representative body said.
Among businesses who participated in the most recent CEMA monthly ‘Business Barometer’ survey, production capacity around Europe is only at three-quarters of what it was before Covid-19 started to take its toll.
On a slightly brighter note, order volumes are at a relatively good level, due to a high order intake before the pandemic hit.
However, for the coming six months, a large majority of the industry representatives who took part in the ‘Business Barometer’ predict declines in incoming orders over the coming weeks and months.
Almost three-quarters of the companies already report falling orders, both from within the EU and outside it, with more than half of them even reporting double-digit decreases.
However, there may be some light at the end of the tunnel, according to CEMA.
This most recent barometer shows that less businesses are predicting a turnover decrease of over 20% than last month.
This results in a slightly less negative industry forecast, CEMA noted.
The correction might be the result of an expectation that the order intake will improve again in a few months, so that some losses can be recovered towards the end of the year.
CEMA’s Business Barometer is a monthly survey of representatives from the European agricultural machinery manufacturing industry; it’s been running since 2008.
The survey covers most major equipment sectors – from tractors to municipal equipment. The target group (of respondents) comprises 140 senior managers from nine countries.