German Manufacturing Orders Surge 6.9% in December

German manufacturing saw a strong rebound in December 2024, with new orders rising 6.9% compared to November, according to provisional figures from the Federal Statistical Office (Destatis). This marked a significant recovery after months of slower growth in the sector. The increase, adjusted for seasonal and calendar effects, signals renewed momentum in the manufacturing industry.

The surge in new orders came primarily from the “manufacture of other transport equipment” sector, which includes aircraft, ships, and military vehicles. This sector saw a dramatic 55.5% jump in orders thanks to several large-scale contracts. Additionally, the machinery and equipment sector contributed positively, with a rise of 8.6% in new orders. These gains helped boost the overall result.

However, the automotive industry experienced a slight downturn, with new orders falling by 3.2%. Despite this, other sectors within the industry helped balance out the losses, resulting in an overall increase for the month.

German Manufacturing Orders Surge 6.9% in December

Excluding large-scale orders, new orders still showed positive growth, rising by 2.2% compared to November. In a less volatile three-month comparison, the fourth quarter of 2024 remained flat, showing no overall change in new orders. However, when excluding large-scale orders, the quarter showed a 1.4% increase.

While December marked an encouraging recovery, 2024 saw a 3.0% decline in new orders compared to 2023. The manufacturing sector struggled during the year’s first half, but signs of stabilization appeared in the second half, particularly in the capital goods and intermediate goods sectors.

The intermediate goods sector faced challenges in 2024, with new orders dropping by 4.0% year-over-year. Reduced production of electrical equipment and fabricated metal products primarily drove the decline. On a positive note, the chemical and paper industries saw slight growth, with orders up by 1.8% and 2.2%, respectively.

On the turnover side, real turnover in manufacturing decreased by 0.1% in December compared to November. Compared to the previous year, turnover fell by 3.9%. For the entire year, turnover dropped by 4.0%, with most of the decline occurring in the first half of the year.

Despite the annual decrease in new orders and turnover, the final quarter 2024 showed signs of stabilization. This suggests cautious optimism for Germany’s manufacturing sector in the year ahead.

For the analysis and updates, visit FXAN to stay informed on the latest news and insights. Also, follow us on Instagram.