• 06/09/2025
  • Article

Economic situation in mechanical engineering: growth impetus from process engineering

Expectations for the new German government are high. Things are set to take off again soon. The mechanical engineering industry – traditionally strong in exports – is hoping for markets that have received little attention to date. In any case, some of the specialist sectors that dominate POWTECH TECHNOPHARM are surprisingly strong. And an important visitor industry is also opening up new perspectives with major investments.

Written by Dr. Ulla Reutner

Production facility for colourful gummy bears, which are transported via a stainless steel vibratory conveyor system
Treats instead of tricks: Haribo is investing heavily in Germany. Process engineering is part of this.

The German VDMA sums it up: ‘Together we will find the right course and strengthen the resilience of companies,’ it promises its members. The goal is to ‘safely navigate economic turbulence.’ Looking back at the first quarter of 2025, there is at least a glimmer of hope. Although the mechanical and plant engineering in Germany started the new year with a decline of 2.6 per cent compared to the same period last year, there was a slight upward trend in March. A closer look at the export markets reveals new momentum in the Middle East, Central, South and Southeast Asia, Africa and Latin America. Exports to these countries increased noticeably, in the Middle East by as much as 13.4 percent. “This development is an opportunity, but it needs targeted political support. For example, through new trade agreements and more support for financing and market access,” says Dr. Gernandt, chief economist at the VDMA.

Setback due to uncertainty

However, as the export quota for all specialist areas is around 80 per cent, restrictions on open trade would have serious consequences. The US government's customs policy and the associated uncertainties could hit German mechanical engineering companies hard. This is because the USA is the largest single market. In April, order intake already fell by 6 per cent. At least orders from euro partner countries increased by 11 per cent.

Is the big ‘deal maker’ directly or indirectly controlling the fate of German mechanical engineering? The VDMA is fighting back – and it is relying not only on a U-turn in policy, but above all on the strength of its members. Association President Bertram Kawlath put it this way in the Süddeutsche Zeitung in January: "When the world is moving so fast, there is no time for complacency. I am a sailor. When the wind is blowing strongly, you have to get out of the cabin, even if it's not very comfortable outside."

The VDMA sees itself as a guide for its member companies. Among other things, it wants to support them in responding flexibly, adapting structures and bringing the right innovations on board. At the same time, companies should keep their costs under control and tap into new markets and new business models. With the right recruiting strategies and modern personnel development, the mechanical and plant engineering industry aims to prevent a shortage of young talent. The VDMA provides its members with immediate assistance by guiding them through the regulatory jungle. However, it also confronts political leaders with the need for reforms, ranging from reducing bureaucracy and expanding infrastructure (digitalisation, energy including renewables, transport) to modernising labour markets.

View of the joint stand of VDMA special show with blue banner and VDMA logo, tables and chairs on a central yellow area and several smaller exhibition stands at the edges
The VDMA's special show at POWTECH TECHNOPHARM offers space for partnership-based exchange, networking and inspiration.

VDMA joint stand at POWTECH TECHNOPHARM

In September, the VDMA will offer special support to members of the General Air Technology and Process Engineering Machinery and Equipment associations with a special show at POWTECH TECHNOPHARM. New market entrants in particular have the opportunity to showcase their innovations in the manufacture and processing of powders, granulates, bulk materials and liquids. Many other VDMA member companies have exhibited at the trade fair for many years and are benefiting from its increasing internationality and expansion into the TECHNOPHARM sector.

Exhibitors have high expectations, and rightly so in view of the economic figures. The communities of POWTECH TECHNOPHARM and FACHPACK, which takes place at the same time, are pleased with the growth impulses that originated in the first quarter of 2025 from food and packaging machines (up 3.4 per cent according to VDMA) and process engineering machines and equipment (up 2.8 per cent). Together with liquid pumps (up 3.5 per cent), they were able to compensate somewhat for the development of other mechanical engineering sectors, especially construction machinery (down 18.8 per cent).

Large and medium-sized food manufacturers are investing

Food manufacturers in particular are currently attracting attention and generating optimism with major investments in Germany. According to the Federation of German Food and Drink Industries, Haribo, Ferrero, Schwartau, Ditsch and Bonback are investing tens to hundreds of millions of euros in new plants or production lines in Germany, focusing on innovative technologies. Medium-sized companies such as spice specialist Raps and the Engelke Mill Group are also planning new facilities or have already started operating them.

International growth momentum from India and Brazil

Internationally, India is increasingly developing into a high-growth market for mechanical and plant engineering. According to the VDMA Business Climate Survey, 62 per cent of member companies there expect the business situation to improve, with sales growth of 9 per cent for 2025/2026.

Brazil is also developing positively, with sales growth of 13 per cent in 2024. 31 percent of those surveyed currently report a good business situation. Companies expect 7 per cent growth for 2025. At FCE Pharma and FCE Cosmetique, the largest events for their respective markets in Latin America, taking place in São Paulo from 10 to 12 June 2025, mechanical engineering is currently receiving new impetus. The two trade fairs are part of NürnbergMesse's Processing Alliance, from which exhibitors and visitors to POWTECH TECHNOPHARM benefit.

Visualisation of the planned plant as a modern industrial building with Maoam branding, surrounded by green spaces, trees and a water feature
Haribo plans to invest 300 million euros in a new plant in Neuss, where it will produce Maoam in a particularly sustainable manner on an area the size of 20 football fields.

Author

Ulla Reutner
Dr. Ulla Reutner
Chemist and freelance specialised journalist