Growth accelerates for German plastics processors

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German processor Dr Schneider manufactures auto components.

German plastics processors achieved a new record of €60.8bn in turnover in 2016, a growth rate of 3.2% from 2015. There had been more moderate 1.3% growth in 2015, said the industry's GKV trade association at its traditional Ash Wednesday annual press briefing on 1 March.

The international turnover for German companies rose slightly faster, at 3.6% growth to €22.5bn, while domestic turnover grew by 2.8% to €38.3bn.

Productivity was also higher, the GKV figures showed. The number of employees at the 2,906 GKV member companies rose by just 0.3% to 317,000. But the volume of plastics processed increased by 3.6% to 14.1m tonnes, following stagnation at 13.6m tonnes in 2014 and 2015.

Sector growth was led by packaging (turnover in 2016 of €14.2bn, up 4.4%; volume increased from 4.2m to 4.3m tonnes) and the building industry (turnover €19.1bn, up 4.7%; volume rose from 4.9m to 5.0m tonnes).

Technical parts, representing the automotive industry to a large extent, achieved 1.7% higher turnover at €17.9bn, with volume up from 3.2m to 3.3m tonnes. At a lower level, plastic consumer goods rose 2.0% to €9.6bn, with volume up from 1.3m to 1.5m tonnes.

In view of the UK’s forthcoming exit from the EU, GKV ran a survey among member companies to sound out their views about Brexit. This showed that 4% of the companies surveyed considered that Brexit would be extremely damaging to their business, while 52% thought it could possibly be associated with disadvantages, and 44% thought it wouldn't make any difference for them.

Prospects for completion of the TTIP transatlantic trade and investment pact between the EU and the US have been questioned by observers, so GKV also asked members about how a failure to reach an agreement would affect the companies. Here, 57% expected that it would not make any difference, 41% that there would be disadvantages and just 2% that it would be very damaging.

GKV president Dirk O. Westerheide said 2016 was “in many respects a year of superlatives”. But the trade policy of the newly elected US president Donald Trump is now of concern to GKV, in view of the many plastics parts made in Germany and exported within other goods to the US. GKV recommends Trump rethinks his policies on TTIP and free trade.

On the other hand, Westerheide said GKV has “great hopes about the positive effect to be expected with the CETA free trade agreement between the EU and Canada”.

Whatever the uncertainties, Westerheide said companies should exploit the present environment of low interest rates to make new investments, and avoid a likely increase in interest rates by the ECB in 2018.

In GKV’s outlook for 2017, Westerheide said: “The mood in plastic processing at the beginning of 2017 is shifting between uncertainty and confidence. Nevertheless, confidence prevails and therefore we are encouraged that our industry will continue to follow the success of the previous year in 2017, and then go on to achieve sales growth of between 2 and 2.5% in 2018.”

GKV managing director Dr Oliver Möllenstädt also presented results of a survey among GKV member companies, in which 32% of respondents said they intended to increase investment in 2017, 58% to maintain investment and 10% to reduce it.

Although 35% intended to take on more staff in 2017, 58% to retain existing staff levels and only 7% to reduce them, concern exists among 70% of GKV member companies about continuing shortages of professional staff and suitable candidates for apprenticeship. This concern was expressed by 60.3% of members in the 2016.

Among respondents, 77.7% of the companies have problems in recruiting process technicians, 35.8% suffer from short supply of plastics technicians and 56.1% from difficulty in finding candidates for apprenticeships.

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