Tell us something about CECIMO (European Association of the Machine Tool Industries).
CECIMO focuses on raising awareness of EU decision makers in different sectors. First, we sensitise the EU institutions to the risks of falling into the trap of “low investment – low productivity – low growth”, caused by enduring economic uncertainties and problems to access finance. In some cases, underinvestment is making industrial assets obsolete, all to the detriment of productivity growth. We therefore ask for higher amounts of direct equity and loan guarantees for SMEs, so to help them overcome capital shortages. Secondly, we ensure that EU decision-makers earmark more investments in advanced manufacturing capabilities, so as to boost our sector’s productivity. Such investments help Europe to optimize the use of resources, unlock the innovation potential of companies, compensate for high labour costs, and encourage value-chain cooperation in transferring new manufacturing technologies to the market. Third, CECIMO aims at advancing the skills of MT workforce. The nature of the advanced manufacturing technologies we just mentioned implies that the workforce needs to be equipped with new competences. Fourth, we advocate for the EU to pursue free-trade deals with our trade partners, while ensuring a real global level playing field for European manufacturers. In such context, CECIMO continues paying attention to the existing trade deal negotiations conducted by the EU, in particular with US and India. Lastly, we are an active actor in the discussions over EU ecodesign legislation, which is essential for market acceptance, technology readiness, industry standards and global competitiveness.
What are the initiatives taken by CECIMO to help European machine tool builders?
The initiatives that will keep us busy in 2017 range from additive manufacturing to digitisation, and they aim at helping the machine tool industry to perform excellent results and set a favorable legislative environment at the European level.
Just to give you a glimpse, CECIMO has taken a position on the EC communication for a European Data Economy, where we welcome the prominence of connectivity and production technologies, but we stand for non-legislative approaches that incentivize business to share data and create awareness on access to and re-use of machine-generated data.
In the same field, we launched a digitisation campaign among our members in order to accelerate the uptake of the digital solutions provided by the European machine tool industry. In doing so, we collect and exchange the best practices of European frontrunners.
CECIMO is also involved in additive manufacturing through EU-funded projects. We teamed up with researchers, universities and companies to develop new technologies such as hybrid manufacturing (Kraken Project) or identify the skills needed in the MT industry (METALS Project).
What are the current trends in the European machine tool industry?
According to most of the companies that participated in a CECIMO enquiry, data-driven business models will be one of the main trends over the next 10 years. New service-oriented business models are emerging with the aim of providing greater value for end-users. Indeed, machines, systems and factories of advanced manufacturing are getting connected across borders and the competitiveness in the manufacturing sector is gradually pushed from “producing goods with certain functions” to “generating systems that increase performance and create value”. By analysing industrial data available along the global value chain, European machine tool builders can improve the performance, energy- and resource-efficiency as well as safety of their products.
Additive manufacturing techniques too plays a positive role in boosting productivity, as their layer-by-layer production minimizes the number of operations. It therefore drastically cuts time and costs as well as reduces time-to-market. In addition to it, investments in Europe are being made in hybrid machines, a new technology that combines additive and subtractive manufacturing.
What is the current market size of European machine tool industry? Please provide some data about production, consumption, export and import?
With a yearly consumption of more than 18 billion euro, the European market size is certainly appealing to machine tool exporters. CECIMO countries account for around 85% of it, which corresponds to nearly one fourth of the global MT consumption. We also foresee in the short run that some previously postponed investments will likely have a positive impact on MT sales in the continent, boosting our consumption.
To get into details, our analysis of the preliminary data for 2016 show that all CECIMO countries altogether forecast 24.2-billion-euro of production and 15.4-billion-euro of consumption, data which is slightly better that the previous year. As for the trade figures, we expect MT exports to amount to 18.7 billion euro and imports to 9.8 billion euro.
What’s the European market share in the global machine tool industry?
The European market share of global production is above 40%, and Europe accounted for one of every four euros of consumption in machine tool in 2016. This clearly reflects that our industry is coping quite well with the relatively negative global trends.
In recent time, Asian countries like Japan, S Korea, China, Taiwan and India have witnessed significant growth. How do you see the competition from Asian countries?
Competition from Asian countries is increasing. Their major economies aim at driving up the manufacturing sector through initiatives such as “Make in India” or “Made in China”. In particular, they have been relying on the machine tool sector to pursue their economic development. Apart from the fact that 4 out of 10 machine tools (by value) exported originate from Asia, their domestic markets account for approximately 55% of the MT worldwide consumption.
Looking ahead, both Chinese and Indian economies will keep growing at the present rates of 6.5-7% in the coming years. China, in spite of its economic rebalancing and effects of cuts to investments, is predicted to remain the major machine tool consumer and producer, at least over the short term. As for India, it shows healthy prospects for machine tool consumption: the growth rate is forecasted at 8% both in 2017 and 2018.
How do you see the Indian machine tool industry?
India continues to be a leading economy with high growth prospects, and its strong industrial development makes it performing as a key player at the global level. The machine tool sector is certainly not an exception.
Indian exports of machine tools significantly increased in 2015 and, even though at a slower pace, still expanded during the first three quarters of last year. Moreover, MT companies enjoy a strong internal demand and a healthy expansion prospects across the main MT consuming sectors, as, for example, the motor vehicles sector. These figures are confirmed by a weighted output expected to pick up around 7.5-8% in 2016 and 2017. To conclude the positive overview, the investments in this sector are forecasted to increase by 7% on an annual base, both in 2017 and 2018.
Needless to say, CECIMO companies have strong commercial links and solid partnerships with Indian MT businesses, which was confirmed by our active presence at the last IMTEX edition. India ranks as the third major Asian client, the seventh most important customer and the eighth supplier for CECIMO.
How much (in numbers) does India import from Europe?
According to 2015 figures, India imports nearly 400 million euro in machine tools from Europe. India stands as one of our major external sales’ destinations for Europe. Indeed, as our third Asian client, India accounts for 7.5% of sales from CECIMO to Asia, and 3% of the total sales overseas. Thought it must be said that, in line with the global trade trend, in the period January-September of 2016 Indian imports from Europe counted probably 4-5% less than the same period of 2015.
From the Indian perspective, the national industry does rely on European MT suppliers, as half of its top 12 machine tool providers are from European countries (Germany, Italy, Switzerland, Spain, Belgium and the UK).
What would be the theme for EMO Hannover this year?
As you know, EMO is the leading trade fair for metalworking technology, offering a comprehensive overview of the sector and providing an innovative and international platform where the whole world of metalworking meets. As EMO trademark owner, CECIMO plays a major role on the international market for promoting the exhibition, so let me introduce you some novelties for the 2017 edition.
First of all, young companies will have the possibility to exhibit in a special stand themed around “Start-ups for intelligent production”. Moreover, we will continue showing best practices of “Industry 4.0” and connectivity around Europe and create a platform for Additive Manufacturing, where researches can meet industry and vice-versa. We will also continue sending the message that the future of our industry depends on well-educated and highly skilled workforce.
Any message for Indian companies regarding EMO Hannover?
I would like to confirm to Indian companies that the relations between our continents are solid and EMO is the perfect occasion to foster our links and partnerships.
This is evident when we look at EMO figures. In December 2016, it was announced that the official registrations at the EMO Hannover 2017 counted to more than 1,700 firms from 40 different countries, which means that the current registration status lies significantly above the comparable result of the Hannover 2013 edition. A key difference with the previous editions is that not only German manufacturers have registered for sizeable stands, but also Asian companies. Overall, Asia currently accounts for more than a fifth of the EMO’s exhibitors.
Indian companies will therefore have the possibility to explore its attractive and high-potential market during “India Day”, which will take place on September 20, 2017. It will feature conferences to report technical and commercial trends from Indian experts and representatives from Indian user sectors.
CECIMO will be glad to welcome you at our booth to exchange information, good practices and nurture connections.