Se 1 | Ep 13
The state of play

At the recent EMO exhibition, there was a lot more on offer than innovative products and technical insights. Here, we provide you with an overview of the global machine tool market, which was presented in Hannover by CECIMO – The European Association of Manufacturing Technologies at a press conference during the exhibition.

At the conference, there were representatives from all the major machine tool associations – whose manufacturers account for more than 80% of global machine tool production. At the gathering at EMO, the respective associations demonstrated their resilience and strength in the face of a wide range of global challenges. Despite a stable outlook for 2023, projections for the global machine tool industry are tempered by various international and economic challenges. Building on the collective strength of the sector; collaboration, innovation and adaptability will remain key as the industry continues to navigate this evolving landscape.

The event united machine tool industry leaders from the United States, China, Japan and Europe. The opening remarks at CECIMO’s Press Conference at EMO Hannover 2023 from Dr Heinz Jürgen Prokop, CECIMO’s President were: “At a time of profound political and economic uncertainty, the promotion of international cooperation is imperative.”

Mr Marcus Burton, Chairman of CECIMO’s Economic Committee, highlighted CECIMO’s commitment not only to lobbying for favourable conditions for the sector but also to fostering international cooperation with machine tool associations around the world. In that context, he also unveiled key insights from CECIMO’s recently published Global Machine Tool Report 2022, which could not have been produced without such cooperation. Based on the latest database update, Mr Burton highlighted that Global MT (machine tools) production reached a level of €79.2bn in 2022, reflecting an annual production increase of 11.9%.

In the same year, MT production in the CECIMO countries recorded an increase in production of 12.8%. With a level of €25.3bn, CECIMO maintained its share of 32% of global machine tool production. On the consumption side, CECIMO countries accounted for almost a quarter of global machine tool consumption, with a total value of around €18.7bn in 2022, a 25% increase compared to 2021.

During his presentation, Mr Burton also revealed the latest estimates for 2023 for global and European production. While he highlighted that MT production in the CECIMO countries is expected to grow by around 5.5% to reach a level of almost €27bn in 2023, global production is expected to remain more stable, slightly below the 2022 level. In his concluding remarks, he pointed out that: “In light of current developments, we have slightly downgraded our expectations. Nevertheless, we remain optimistic about the positive growth in European production in 2023 and our initial indications for 2024 are positive”.

However, he also highlighted the significant challenges on the horizon, including the headwinds of slowing global economic growth, rising interest rates and geopolitical shifts resulting from the ongoing conflict in Ukraine. These factors collectively inject a notable degree of uncertainty into the short-term demand landscape for the machine tool industry.

In reference to the Chinese machine tools sector, Mr Mao Yufeng, President of China Machine Tool & Tool Builders’ Association (CMTBA), pointed out that: “From January to July 2023, sales of metal cutting machines dropped by 4.3% to USD$10.76bn compared to last year. On the other hand, sales of metal forming machines went up by 6.9% to USD$6.16bn”. He also stated that 2023 has witnessed heightened endeavours in industrial restructuring and shifts within China’s machine tool consumer market. Among others, this includes a decline in overall automotive production, but a notable increase in the use of new energy vehicles. In addition to shifts in consumer markets, he highlighted several significant challenges that contribute to the uncertainty surrounding the outlook for the machine tool sector. These challenges include a fragile economic recovery, persistent inflation, financial market instability and increasing debt pressures.

Looking at the Japanese metal cutting machine tool sector, Mr Kazuo Yuhara, President of Japan’s Machine Tool Builders’ Association (JMTBA) highlighted remarkable growth for the Japanese metal cutting machine tools sector in 2022. Total orders surged to a record-breaking Yen JPY 1,759.6bn, a 14.2% increase on the previous year. Production of metal-cutting machine tools increased by 20.5% in 2022 over the previous year to JPY 1,078.8bn, with a strong growth trend in both export and import levels. Looking at the most recent period of January to July 2023, he noted the decline in order volumes for metal-cutting machine tools. However, he highlighted positive expectations for the impact on demand of investments in green, digital and resilience-related areas.

Reviewing the American Machine Tool Industry, Mr Douglas K. Woods, President of AMT – the Association for Manufacturing Technology in the USA, emphasised continued stable conditions for the American Machine Tool Industry in 2023 and 2024. This follows a year of near-average consumption of USD$9.6bn in 2022. In 2023, the impact of tightening US monetary policy has become apparent, leading to a slight decline in machine tool consumption. However, indicators for 2024 suggest a recovery in machine tool production and imports, while exports stabilise, leading to an increase in consumption.