Future strategies for the European machinery manufacturers

The German Mechanical Engineering Industry Association (VDMA) and the consulting firm McKinsey & Company presented on June 1st in Brussels the findings of an study entitled "How to succeed: strategic options for European machinery".

The analysis was based on a survey of 215 machinery manufacturers from 18 European countries, plus more than 20 interviews with industry key decision makers. According to the results, the overall financial situation is positive: these companies have earned EBIT margins of 10 percent on average in recent years and grew by 7 percent annually. However, competitors are closing in, and times are becoming more challenging. A slower growth is expected in China, Russia, and Latin America, so European machinery manufacturers will need to look for opportunities in niche markets, and concentrate on the services they're offering.

The future will increasingly be shaped by digitization: the new business models based on data will generate more than 10 percent of the sales in 2020. Currently this share is just 3 percent.

To find out more about the trends that will involve Europe’s mechanical engineering sector, an industry employing 2.9 million people, you can download the study from www.vdma.org/ems