The general economic situation remains tense. The German economy shrank by 0.3% in 2023, adjusted for price and calendar effects by 0.1%. This is the second decline in four years. Another economically and structurally challenging year is expected for 2024. GDP in Germany is forecast to fall by 0.2%. Energy-intensive industries are particularly affected due to high energy costs and rising wages.
The automotive industry, the most important customer sector for electroplating and surface technology, continues to experience uncertain times. In 2023, 90.8 million vehicles were built worldwide, which corresponds to growth of 10.1%. In Germany, 4.1 million cars were produced, an increase of 18% compared to the previous year. However, production is still 12% below the pre-crisis level of 2019.
A total of 2.84 million new vehicles were registered in Germany in 2023, which corresponds to growth of 7%. However, new electric registrations are clearly in the red, with a decline of 16% for a total of 700,200 electric cars.
Mechanical engineering with declines in Germany and gloomy mood among SMEs
For example, while all four major production locations in Asia, led by India, continue to record growth, the average sales growth of German mechanical engineering companies will be -0.5% in 2023. Due to the slump in orders, the VDMA expects production to decline by 2.0% in real terms in 2023. German production figures are also expected to fall by 2.0% in 2024, with a 2.4% drop in sales development.
However, a particularly striking setback was seen in medium-sized industrial companies, whose business climate fell by 5.3 points in December. Above all, skepticism about the future has increased again. Thanks to rising real wages and increasing consumer spending, there are nevertheless prospects of a moderate economic recovery in 2024.
Electroplating and surface technology in decline
Developments in the electroplating and surface technology sector show clear parallels with the SME barometer. The picture has been particularly bleak since late summer: sales are falling, sometimes at double-digit rates. The industry, which is dominated by SMEs, has an estimated market volume of around 45 billion euros across Europe and employs around 440,000 people. The market volume in Germany is difficult to quantify, as official statistics only cover industrial suppliers. The ZVO estimates it at around 17.5 billion euros, making Germany the leading country for surface technology in the European Union.
For 2023, there were initially signs of further stabilization in the industry: In the first five months (January to May), the Federal Statistical Office still reported an increase in turnover of 10.5% to around €3.3 billion compared to the same period last year (around €3 billion) according to preliminary figures. Domestic sales increased by 11.9% to around €2.1 billion (January to May 2022: around €1.9 billion), while foreign sales rose by 8.2% to just over €1.2 billion (January to May 2022: €1.1 billion).
However, the outlook for 2023 as a whole and for 2024 has clouded over. Sales have already slumped in fall 2023. This is due on the one hand to the geopolitical situation and economic development, and on the other to higher financing and energy costs. The prices for gas and electricity, which are particularly important for the industry, have recently fallen again significantly. However, they are likely to remain noticeably above the level that was common before the start of the energy crisis. In energy-intensive industries such as electroplating and surface technology, production capacities are therefore likely to be reduced in the longer term.
Training figures remain at a low level
In 2023, the overall number of apprenticeships for the specialist professions in electroplating and surface technology remained at roughly the same level as the previous year: 435 apprentices were trained as surface coaters nationwide in 2023, 336 of them in industry and 99 in the skilled trades. That is 1.5 percent fewer than in 2022.
However, there was a slight year-on-year increase of 5.5 percent to 655 trainees nationwide for prospective process mechanics for coating technology.
2023 results of the ZVO members
With a total of 20,000 employees, they generated a turnover of 2.198 billion euros in 2023, a slight increase of 3.17% compared to the previous year. However, the ZVO members' forecast for 2024 is significantly worse: They expect turnover to fall by 12 percent to just 1.934 billion euros. In the annual ZVO survey, 34% of the companies surveyed rate their current economic situation as poor or very poor. That is more than twice as many as in the previous year. Only 21 percent still describe it as good or very good, half as many as in 2022.