European Foundry Industry Sentiment

Octo­ber 2023:
Down­ward Trend Per­sists: European Foundry Sec­tor wit­nesses another slide 

The European Foundry Industry Sen­ti­ment Indic­ator (FISI) has recor­ded again a decline, rein­for­cing the neg­at­ive trend observed in Septem­ber. With a decrease of 1.9 index points, the index now stands at 91.0, down from 92.9 last month.

The foundry industry faces numer­ous chal­lenges, each con­trib­ut­ing to its cur­rent decline. The most prom­in­ent factor is a sub­stan­tial reduc­tion in over­all pro­duc­tion levels in recent months. Fur­ther­more, the ongo­ing dis­cus­sions on eco­nomic policy primar­ily revolve around major indus­trial cor­por­a­tions, which are grow­ing more doubt­ful about Europe as a favour­able busi­ness loc­a­tion com­pared to North Amer­ica. Foundries express sig­ni­fic­ant con­cerns about the inter­na­tional com­pet­it­ive­ness in gen­eral and sur­round­ing the uncer­tainty and avail­ab­il­ity of raw mater­i­als and scrap. These inter­twined factors col­lect­ively high­light the ongo­ing pres­sures faced by the foundry sector.

Mean­while the Busi­ness Cli­mate Indic­ator (BCI) stands at ‑0.33 index points in Octo­ber. This marks the fourth con­sec­ut­ive time that the BCI is below the crit­ical threshold of 0 index points. Even though the index improved as little as 0.02 index points from last month the situ­ation is still very tense and, in some parts, pess­im­istic. The pre­vail­ing con­di­tions echo those exper­i­enced in Septem­ber 2023, with an evid­ent feel­ing of uncer­tainty in the air. The neg­at­ive BCI can be attrib­uted, in part, to a less favour­able assess­ment of order-book levels in com­bin­a­tion to a reduc­tion in pro­duc­tion in recent months. Addi­tion­ally, the employ­ment expect­a­tion for the months ahead had a neg­at­ive impact.

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:

Johannes Kappes
Sec­ret­ary Com­mis­sion for Eco­nom­ics & Stat­ist­ics
phone: +49 211 68 71 — 291
mail: johannes.kappes@caef.eu