European Foundry Industry Sentiment

Decem­ber 2022: Unclear mar­ket sig­nals and little impulse

The European Foundry Industry Sen­ti­ment Indic­ator (FISI) moves side­ways in Decem­ber. A minor improve­ment by 0.1 points brings the index to a value of 103.1 points. Thus, it is the second month in a row without major changes in the over­all cal­cu­la­tion. How­ever, single com­pon­ents of the FISI develop dif­fer­ently. While busi­ness expect­a­tions for the next six months increased for the first time since August, the assess­ments of the cur­rent busi­ness situ­ation decreased in Decem­ber. While there has been a down­turn in the situ­ation of the iron foundries, it is mainly the non-fer­rous metal foundries that are provid­ing pos­it­ive signals.

The European vehicle man­u­fac­tur­ing industry is still in a crisis in which OEMs are gen­er­at­ing high profits due to lower unit num­bers and the focus on high-mar­gin mod­els, while sup­pli­ers in the volume mar­ket are suf­fer­ing at the same time. Recently, how­ever, there have been more pos­it­ive mar­ket sig­nals from the vehicle man­u­fac­tur­ing sec­tor. While many European coun­tries again have to accept a minus in pas­sen­ger car regis­tra­tions for the year 2022, the mar­ket with the highest volume, Ger­many, has grown slightly. This is mainly due to notice­ably higher fig­ures in the two final months. How­ever, the fact that PHEV and BEV vehicles stand out also indic­ates that spe­cial effects with regard to a reduc­tion in gov­ern­ment sub­sidies at the turn of the year have caused pull-for­ward effects. The order back­log for the first half of the year, which is inde­pend­ent of this, nev­er­the­less gives cause for optim­ism. With slightly more optim­istic mac­roe­co­nomic fore­casts, the next few weeks will show where the eco­nomy might be head­ing in 2023.

Mean­while the Busi­ness Cli­mate Indic­ator (BCI) main­tains its level of 0.54 points in Decem­ber. While the order situ­ation remains good, expect­a­tions of fur­ther price increases are falling.

The FISI – European Foundry Industry Sen­ti­ment Indic­ator – is the earli­est avail­able com­pos­ite indic­ator provid­ing inform­a­tion on the European foundry industry per­form­ance. It is pub­lished by CAEF the European Foundry Asso­ci­ation every month and is based on sur­vey responses of the European foundry industry. The CAEF mem­bers are asked to give their assess­ment of the cur­rent busi­ness situ­ation in the foundry sec­tor and their expect­a­tions for the next six months.
The BCI – Busi­ness Cli­mate Indic­ator – is an indic­ator pub­lished by the European Com­mis­sion. The BCI eval­u­ates devel­op­ment con­di­tions of the man­u­fac­tur­ing sec­tor in the euro area every month and uses five bal­ances of opin­ion from industry sur­vey: pro­duc­tion trends, order books, export order books, stocks and pro­duc­tion expectations.

CAEF Con­tact:

Till­man van de Sand
Sec­ret­ary Com­mis­sion for Eco­nom­ics & Stat­ist­ics
phone: +49 211 68 71 — 301
mail: tillman.vandesand@caef.eu