Business climate further deteriorating from high level

The general business climate index of the agricultural machinery industry in Europe has further cooled down after reaching its record peak at the beginning of this year.

Turnover in the coming six months seems to be secured at high level based on previous incoming orders, however, there is for the first time since 2016 a majority expecting decreasing order intakes. Correspondingly, on average the companies continue to expect their turnover to grow by 5% in 2018, but slightly downgraded their forecast to 3% in 2019.

Both future expectations and current business evaluation for tractors have deteriorated significantly. Business climate for livestock equipment continues to be far above industry average, however, in the meanwhile livestock is the segment with the highest share of manufacturers expecting declining orders (56%).

Among the major European markets, the expectations for France and Spain have continued to improve. On the other hand, Germany and Italy have further lost confidence. In this context, the results on investment need may also be worth mentioning: compared to March the investment need is assessed significantly higher in France but noticeably lower in Germany.