EU white goods production is expected to fall -1.9% on-year in 2019 for a consecutive year, before rebounding 0.8% in 2020, according to European steelmakers’ association Eurofer.
Economic fundamentals will remain, on balance, supportive to overall private consumption, which should help demand for electric appliance products across the EU, Eurofer says. Tightened labour markets resulting in rapid wage growth, coupled with very low inflation still below the ECB target of 2%, are likely to continue to underpin consumer spending.
As a result, private consumption is expected to continue to grow at a steady pace of 1.4% in 2019 and 2020. It will be one of the most resilient GDP components during the pronounced economic slowdown over the forthcoming quarters.
EU electrical domestic appliances production fell -3.5% on-year in the second quarter, making it the fourth consecutive quarter without growth. Germany, France, Italy, Spain and Austria saw output decline, while Slovakia, the UK, Poland and the Netherlands recorded growth.
“The domestic appliances market will also continue to be characterised by increasing international competition among brands – and among retailers – as well as by pressures on prices,” Eurofer says in a report seen by Kallanish.
“The continued negative performance of the sector in recent quarters can also be explained by some overcapacity, to which manufacturers are reacting by increasingly trying to achieve economies of scale, aiming at minimising transport costs and locating production as close as possible to end markets and consumers,” the association concludes.
