Almost half of the companies in the metal and electrical industry are expecting a noticeable drop in sales and profits as a result of the war in Ukraine.
(Photo: dpa)
Berlin The economic effects of the Ukraine war are already being felt by German companies. In a survey of 3,700 companies conducted by the Association of German Chambers of Industry and Commerce (DIHK), 78 percent of companies stated that their business was affected by the Russian invasion and its consequences. Nine out of ten respondents name higher energy costs as a noticeable effect in their own company – across all sectors.
60 percent of those surveyed reported rising prices or disrupted supply chains, 18 percent of direct consequences such as the loss of customers and suppliers. Around 3,700 companies nationwide were interviewed for the survey from Tuesday to Thursday of this week.
A survey by the employers’ association Gesamtmetall among almost 1,400 member companies also shows the extent to which the Russian attack on Ukraine is already having an impact. Two out of three companies that receive goods from Russia, Belarus or the Ukraine complained about delivery bottlenecks.
As a result, 18 percent of these companies are already having to restrict production. Dependence is particularly high for iron and steel, metals, natural gas and oil. Almost 40 percent of the companies stated that they could not or only with difficulty compensate for existing or impending supply bottlenecks.
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69 percent of the companies surveyed by Gesamtmetall expect cost increases in purchasing, almost half expect noticeable losses in sales and profits as a result of the Ukraine war.
Around 40 percent of companies in metal production and processing and mechanical engineering have supply relationships with Russia, Belarus or the Ukraine, and in vehicle construction the figure is even 44 percent. There is also a close interdependence on the customer side. Almost three out of four machine builders have customers in at least one of the three countries.
Nevertheless, it is clear to the companies that there is no alternative to the punitive measures against Russia, even if the local economy is suffering as a result, said DIHK General Manager Martin Wansleben: “Despite these painful losses, we hardly hear any criticism of the sanctions imposed.” heavily affected companies war “no basis for business”.
Union warns of oil and gas embargo
However, the survey results on the situation in the companies are only a snapshot, emphasized Oliver Zander, General Manager of the Gesamtmetall. “It is not at all possible to foresee what would happen if the war were to intensify as a result of further sanctions or second-round effects, such as high inflation.”
In business circles, an end to Russian gas and oil deliveries is particularly feared – for example because Germany has imposed an import ban or Russian President Vladimir Putin is turning off the tap. Although Federal Economics Minister Robert Habeck (Greens) has so far rejected a German ban on imports of Russian energy supplies, the Federal Government, under the leadership of the Federal Network Agency, is already working on plans as to which companies should be taken off the grid first in an emergency. After the chemical industry, whose association recently warned of a gas embargo, the food industry is the second largest industrial gas consumer in Germany.
The trade union side is therefore also cautious with demands not to buy any more energy sources in Russia overnight, as IG Metall boss Jörg Hofmann told the Handelsblatt: “An immediate embargo for gas, hard coal and oil would be counterproductive and would harm the economy and consumers in Germany much more harm than Russia.” It is clear that Germany must diversify its energy imports more. “But that doesn’t happen overnight.”
>> Read here: Heated Economists Debate: What Real Effects Would an Embargo on Russian Energy Have?
According to the total metal survey, 23 percent of the companies surveyed fear for their economic existence should the conflict intensify further. One-fifth of those surveyed already see themselves as affected by global competition.
The DIHK sees the industry, which is dependent on energy and raw materials, in a mood of crisis. Two-thirds of the companies in this sector would have to pass on price increases to customers in view of the sharp rise in purchase prices and a tense financial situation. “There is additional potential for inflation here,” warned Managing Director Wansleben. After all, almost a third of the companies surveyed already stated that they were canceling or postponing investments.
More on this: Order backlog in German industry falls for the first time in almost two years