German industry has had a ‘lost year’, contributing to EU manufacturing in decline
Germany’s industrial sector ended a ‘lost year’ with a further decline in December, pushing eurozone manufacturing into recession.
French factories also had a grim end to 2024, with the worst month since the height of the pandemic, as political chaos rages.
The declines for Europe’s two largest economies, along with number three Italy, resulted in a sector contraction across the eurozone.
Closely watched figures from the Purchasing Managers Index (PMI) gave a score of 45.1 on a scale where 50 separates growth and contraction.
Germany posted a score of 42.5, as the country saw “a sharp and accelerated decline in both output and new orders” and further cuts to employment.
The once-mighty industrial base is in turmoil after losing access to cheap energy from Russia due to the war in Ukraine and a slump in demand from China.
Strike: Germany’s industrial base is in turmoil after losing access to cheap energy from Russia, sparking industrial unrest such as protests by Volkswagen workers (pictured)
The gigantic car industry is struggling with cheap Chinese imports.
That has led to cost cuts and industrial unrest, such as protests by Volkswagen workers.
And it is in political limbo ahead of next month’s elections after the coalition government collapsed.
Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, which compiled the latest figures, said: “The situation is still quite grim. The sector will not emerge from the recession any time soon.
‘The shrinking order book suggests that the new year will not start much better. It’s been a lost year.’
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