German rubber industry leader calls on EC to halt “downward spiral”

Frankfurt/Main, Germany – German rubber industry association the WDK has highlighted the essential need for a competitive industrial base within the EU’s transition to a net-zero economy.

In a statement issued following the re-election of Ursula von der Leyen as president of the European Commission, the association reiterated calls for the EU Green Deal to be linked to an ‘industry deal’.

The EU’s ambitious sustainability goals can only be achieved with a strong economy that can focus on its core business tasks rather than “overwhelming” reporting obligations, said Michael Klein, president of the WDK.

To emphasise the point, Klein cited the “massive” increase in corporate insolvencies since the start of 2024 as an indicator that the German economy is lagging behind international competition.

For instance, he said, major insolvencies the automotive sector rose 67% in the first half, with suppliers hit by “sluggish sales of electric vehicles and a politically ordered end to the combustion engine."

According to the industry leader, the situation is not much better in other industrial sectors, including mechanical engineering and construction.

Meanwhile, the latest WDK member survey – for the three months to 30 June – showed that the business in German rubber industry had remained in decline for the last three quarters.

Overall, sales, sales and production in the German rubber industry after the first half of 2024 are almost 5% lower than in the same period of the previous year.

Likewise, incoming orders look set to remain on a downward track over the coming months in Germany, while sales are projected to fall 4% in full-year 2024.

Weak domestic and subdued foreign demand for industrial rubber products are primarily weighing on companies' bottom line, as is a shortage of skilled workers, found WDK – noting also increasing relocation of production out of Germany.

Concluded Klein: "Without financial relief on the revenue side or on the expenditure side with lower corporate taxation, cheaper energy costs and significantly less bureaucracy, there is a risk of a downward spiral.

“Von der Leyen and the new EU Commission have the recovery in their hands. In particular, by throwing off the ballast of state corporate over-regulation."