The German machine tool industry experienced a decline in orders in early 2025. While international demand showed some strength, domestic orders in Germany dropped significantly.
Europe remained the most important sales region. Several countries in the region reported increased demand. Asia also showed signs of recovery, especially China, which saw slight growth after a long pause.
In contrast, the United States market faced difficulties. Although there is ongoing demand for advanced manufacturing technology, broader uncertainties affected market expectations. Industry experts noted that medical technology and aviation sectors performed well despite these challenges.
Overall, orders received by the German machine tool industry in the first quarter of 2025 were 10% lower than in the same period last year. Domestic orders in Germany fell sharply by 30%. However, orders from foreign markets stayed about the same as last year.
Markus Heering, executive director of the German Machine Tool Builders’ Association (VDW) in Frankfurt, said, “March brought a small ray of hope after a weak start to the year. Orders increased by 2%, mainly due to demand from abroad, especially from the eurozone. However, the German domestic market still falls far short of expectations.”
Europe was the top sales market in the first quarter, with demand rising by nearly one-third compared to a low base. Asia’s downward trend ended as orders grew by 6%, marking the first positive growth in some time. China replaced the US as the most important single market.
In the Americas, Mexico contributed positive momentum through new projects. But orders from the US declined by 10%. Heering stressed, “The US industry still needs German manufacturing technology to modernize because there are not enough suitable suppliers domestically.”
Among key customer industries, medical technology and aviation showed the strongest demand, according to a recent survey of machine tool and component manufacturers. The engineering sector also showed signs of recovery with encouraging growth. However, the automotive industry remains a major concern.
Heering concluded, “It is too early to say there is a trend reversal. Increased international uncertainty, especially from the unpredictable US tariff policy, continues to weigh on the sector. Export controls and high costs are also major obstacles to recovery.”
