Significant Rise in Italy's Machine Tool Industry Orders for Q3 2024

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Italy's machine tool industry sees a considerable rise in orders for Q3 2024, marking a break from a six-quarter slump. But Ucimu President Riccardo Rosa warns of structural challenges still gripping the sector.

Machine tool orders in Italy rose 7.9 percent in the third quarter of 2024, marking a return to positive growth after six consecutive quarters of decline, according to data from Ucimu – Sistemi per Produrre’s Economic Studies Department. However, Ucimu President Riccardo Rosa warns that the sector still faces significant challenges, despite the rebound.

The index measuring overall orders reached 52.7, based on 2021 values. International orders saw notable growth, climbing 10.7 percent to an index level of 94.4, while domestic orders increased by 4.3 percent, reaching an index value of 13.7.

Riccardo Rosa: “Despite this, the situation remains complicated for at least two reasons. Firstly, because “the plus sign” is the result of a comparison with one of the quarters characterised by the weakest order intake ever, i.e. the period July-September 2023, which, in absolute terms, is only slightly higher than that recorded in the same quarter of 2020, the year that was plagued by the pandemic. Therefore, it is clear that we are still at a very low level”.

“Secondly, because by observing this quarterly outcome in more detail, a sharp separation appears between the performance of the sector of sheet metal forming and sheet metal processing machines and that of metal cutting machines”.

Sheet metal forming and processing machines have shown resilience, finding demand in various sectors, while metal cutting companies struggle with foreign competition, particularly from Asia, and a stagnant automotive sector. This dual-speed growth in the machine tool sector reveals underlying structural issues.

“Strong competition from Asia and uncertainty in the automotive sector have hindered investment in new technologies for metal cutting,” explained Rosa. “This is evident in the ongoing crisis within the German economy, a key automotive industry player.”

Rosa emphasized the need for European and international policy support to assist the industrial transition, particularly as Europe reorients its automotive and manufacturing sectors towards sustainable production. “Green manufacturing must balance economic activity and employment while addressing environmental concerns,” he said, echoing recent remarks from Confindustria President Emanuele Orsini. He suggested that sustainable mobility solutions should consider a wider range of technologies, beyond just electric vehicles, to benefit the entire supply chain.

Rosa also urged the Italian government to streamline the Transition 5.0 measure to encourage investment in energy-saving technologies. With Transition 4.0 and 5.0 policies set to end next year, Rosa called for an immediate roundtable with industry representatives to outline the next steps. “Not much time is left. We must act now to sustain the development and growth of our industry into the future,” he concluded.

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