One year ago, strongly revitalized demand gave rise to hopes of a sustained upturn. However, in the third quarter of 2014, this optimism slowly gave way to subdued expectations. The double-digit growth rates recorded in the first half of the year for orders from abroad reversed into a negative trend in the third quarter of 2014. Foreign orders were down 3.6 percentage points on the prior-year period. Order levels as a whole were maintained in the third quarter of 2014 (+0.3%) only thanks to increased domestic orders (+14.5%), which account for just under one quarter of the revenues posted by companies in the MEM industries.
Sales were 4.2 percent lower in the third quarter of 2014 in a year-on-year comparison, also reflecting a slowdown in business activity. However, this figure masks a low base effect, given the strong sales recorded in the third quarter of 2013. Viewed over all three quarters of 2014, sales growth therefore amounts to just 1.4 percent. This trend matches that of exports by the MEM industries, which totalled 48.7 billion francs in the first nine months, thus rising by 0.7% year on year.
Sluggish trend in Europe
In the key sales markets, momentum in the first nine months of the year was strongest in the USA (+3.1%) and China (+8.7%). With growth of 5.7 percent, the Asia region performed considerably better than the EU, where a 0.3% decline in exports was recorded. The weak economy in Central Europe was reflected in sideways-trending exports in the core markets of Germany (0.9%) and France (0.6%), while the political tensions in Eastern Europe resulted in a significant drop in exports to Russia (-6.7%) and Ukraine (-32.3%).
So far this year, the uncertain geopolitical and economic situation has curbed exports in the electrical engineering/electronics (-4.0%) and precision instrument (-0.8%) sectors especially. The metalworking and mechanical en-gineering sub-sectors, on the other hand, were both able to post moderate export growth of 2.8 percent.
The widespread optimism that reigned among companies at the start of the year is barely visible at present. Whereas in the first quarter of 2014, 50 per-cent of companies expected order intake to rise for the year as a whole, only 36.5 percent of those surveyed now anticipate an improvement in their order situation over the coming 12 months. By contrast, the number of those expecting order levels to fall in the same period has risen by 9 percentage points. Companies expect to see sustained growth momentum coming primarily from North America and the Far East. However, they are much less optimistic about growth chances in the European market than they were three months ago.
The future performance of the MEM industries depends to a great extent on economic developments in its main market of Europe. A further political set-back looms in the shape of worsening operating conditions in Switzerland. On 30 November, the electorate will be asked to vote on two initiatives – Ecopop and Gold – that would massively weaken both Switzerland's capacity for inno-vation and its economic strength. Both initiatives would lead to the country becoming isolated and unduly restrict its political room for manoeuvre, thus undermining the foundations of Swiss prosperity. That is why Swissmem is resolutely campaigning for a NO in both cases.
For further information please contact:
Ivo Zimmermann, Head of Communications
Phone: +41 (0)44 384 48 50 / mobile: +41 (0)79 580 04 84
Philippe Cordonier, Communications Manager, French-speaking Switzerland
Phone: +41 (0)21 613 35 85 / mobile: +41 (0)79 644 46 77