According to the latest VDMA survey, the impact of the epidemic in China has recently been alleviated. Nevertheless, the mechanical engineering industry expects sales to decline sharply.
Although the economies of Europe and the United States are still paralyzed by the epidemic, China's production is slowly picking up. The second survey recently conducted by the VDMA China office was answered by 118 member companies, showing that the local situation has improved significantly. At the beginning of March, 57% of the respondents believed that the impact of the pandemic was great, but this number has now dropped to 46%. On the other hand, the proportion of respondents who think the impact is small has increased from 3% to 13%.
In the local transportation system, obvious easing is obvious. For 82% of companies, the transportation situation within China has improved. However, delivery from outside to China and from there to other countries is still difficult, and the cost of doing so has increased, especially for air freight. Claudia Barkowsky, Managing Director of VDMA China, said: "Companies that produce products for the local market and have a high degree of localization are now clearly in an advantageous position." Four weeks ago, strict transportation restrictions and delays in production recovery after the Lunar New Year were still facing these companies The biggest challenge.
Employee mobility is still limited
Currently, the mobility of service and sales personnel is greatly restricted. 73% reported severe or obvious restrictions. And the situation is still tense with regard to the supply chain and orders received. Barkowsky said: "The measures to travel in China are still sporadic. Customers have not handled this situation consistently. Access is allowed today and access is denied the next day."
Information about the loss of sales is mixed. 64% of the respondents surveyed in early March expected to suffer losses in the first half of 2020, and this number has now risen to 73%. However, compared with the first survey, 18% (previously 2%) of the respondents said that they are likely not to be affected by the loss, and 6% of the respondents even said that sales have increased ( March: 0%). Barkowsky said: "We hope this is the dawn of the end of the tunnel, not just the short-term impact of temporarily suppressed demand."
The immigration ban brings new problems
However, China's entry ban, effective March 28, 2020, has created new problems for machine manufacturers. Without the support of the headquarters, new production lines cannot usually be commissioned, requiring service technicians. In some cases, the foreign manager has not returned to China. "The ban on access may put companies under increasing pressure. Chinese customers ca n’t wait to see the situation stabilize in other parts of the world. The People ’s Republic of China hopes that the economy will return to the right track as soon as possible, while local companies are also working hard to resume business. "Barkowsky explained. However, there are currently no signs of lifting the access ban.
