According to VDMA survey, mechanical engineering is still subdued – but not without hope

The packaging industry is full of ideas – but the mechanical and plant engineering sector that drives it is currently struggling. The mood? Rather glum. The figures? Not much better. But: there is also light at the end of the tunnel.

According to a recent survey of 936 companies by the German Engineering Federation (VDMA), only 26% rate their current situation as good or very good. At the same time, 32% say that things are going badly or even very badly. And the rest? More than half do not expect any major changes in the next six months. Nevertheless, 29% are optimistic about the second half of the year.

Turnover is similarly mixed: according to the survey, only 42% of respondents expect nominal growth in 2025. Around 30% expect a decline, and 28%, a standstill. Nevertheless, 58% believe that things will pick up again in 2026.

“The mood in the mechanical and plant engineering sector remains tense due to trade tensions and geopolitical conflicts, as well as the resulting high level of uncertainty worldwide,” says VDMA Chief Economist Dr. Johannes Gernandt. He continues: "Companies are cautiously optimistic about the second half of the year. The bottom line is that the current year is likely to be mixed for the majority of companies and sales growth will not return until 2026."

A look at the sales markets shows: North America remains an anchor despite all the trade disputes. 31% of the entrepreneurs surveyed see good to very good opportunities there, while one in four reported poor or very poor sales opportunities to the VDMA. The situation in the Near and Middle East is assessed as similarly positive. Germany, on the other hand, is in the doldrums – 43% of survey respondents report poor or very poor prospects. China does not come off well either: 41% negative, only 20% positive.

And the staff? Here, too, the situation is mixed. 27% of companies are planning further job cuts. At the same time, short-time work is falling, with 29% expecting a reduction. This shows that orders are coming in again and machines are slowly starting up. “Companies are increasingly bringing their employees back from short-time work in order to process incoming orders again, which raises hopes that job cuts will slow down somewhat in the coming months,” says Florian Scholl, Economics and Statistics Officer at VDMA.