Carmakers drag down German export expectations in September

German industry's export mood clouded slightly in September, according to a survey published by Munich's ifo Institute on 25 September. The export expectations index fell from 9.8 points in August to 8.0 points. A positive reading means more companies still expect exports to grow than to shrink.

Carmakers turn negative

Klaus Wohlrabe, who heads ifo's surveys, attributed the setback primarily to the automotive industry. After optimistic expectations in August, carmakers once again expect exports to decline, while in many other industries the signs continue to point to export growth.

The outlook in mechanical engineering improved considerably. Makers of electrical equipment and of data processing, electronic and optical products also expect exports to rise, and the beverage industry is particularly upbeat. Metal production and processing and the paper industry still expect exports to fall.

Why it matters for Hungary

Germany is Hungary's largest trading partner, and a large part of Hungarian industry, especially automotive suppliers, works for German customers. The index measures expectations rather than actual exports, so Hungarian companies should watch the situation in their own customers' industries: weaker carmakers and stronger machinery makers may affect them in different ways.