EUROMETAL Regional Meeting of SSC from the region Austria + BENELUX + Germany was convened in Valkenswaard (NL) on 07 May 2019.
The meeting was hosted by MCB. a member of EUROMETAL since 2005.
MCB is a main Western European steel stockholding distributor in longs, flats, tubes, stainless and non-ferrous having a performing SSC operation located in Valkenswaard in the Netherlands.
Andreas Schneider from STAHLMARKT CONSULT presented an in-depth analysis od chances, challenges and threats facing today and in future the automotive sector.
Present slowdown in automotive is specifically strong for passenger cars in Germany, less in other parts of Europe. The market for commercial vehicles, on the contrary, is continuing a positive trend.
A key trend was highlighted: For typical German car brands, car production is growing outside Germany and slowing inside Germany, following a new trend: build where you sell.
Regarding automotive suppliers the picture is much more diversified. In fact, in order to analyze a specific market situation you have to go down to grass roots: who supplies whom? in order to understand specific situations and trends.
Challenges facing EU automotive industry are many fold: Brexit, the new USMCA, section 232 applied to cars, weak Chinese market, slump in Turkish economy, e-mobility
What does this imply for the steel supply chain?
- In past years growth of automotive part suppliers was higher than growth of OEMs
- Trend to higher car production outside Germany was partly balanced by higher direct export by Tier-1 to Tier-3 suppliers
- But global market share of German automotive part supliers has stopped rising
- Big suppliers are following OEM’s into markets outside EU. Corresponding steel demand is transferred outside EU
- Pressure on automotive suppliers producing only in Germany or EU
- These trends may negatively impact the business of German or EU SSC
As a conclusion and considering the prevailing trends, Andreas Schneider indicated that in the course of the second half 2019, steel demand from automotive industry in EU might start to recover again.
In a longer term, it might be excluded that EU comes back to the economic dynamics of last years, but a steady market level might be considered as the most probable scenario. Growth in flat steel demand will happen in automotive demand outside EU. Supply chains and steel mix will undergo serious testing regarding the impact of structural changes in automotive industry.
The meeting was continued by a survey among SSC of the “Arbeitskreis” about missed working days due to incidents/ accidents, etc.
Also the position of SSC in the supply chain to the markets for strip mill products was presented by EUROMETAL as well for the EU market as for the regional market Austria+BENELUX+Germany.
All presentations made at this meeting are available to EUROMETAL members in the login area *Knowledge Center* on eurometal.net.
The working group meeting in Valkenswaard was attended by 30 participants.