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Composites Germany - Results of the 22^nd Composites Market Survey

• Critical assessment of the current business situation
• Future expectations brighten
• Investment climate remains subdued
• Different expectations of application industries
• Growth drivers with slight shifts
• Composites index points in different directions

For the 22^nd time, Composites Germany has collected current key figures on the market for fiber-reinforced plastics. All member companies of the supporting associations of Composites Germany: AVK and Composites United as well as the associated partner VDMA were surveyed.
In order to ensure that the different surveys can be compared without any problems, no fundamental changes were made to the survey. Once again, mainly qualitative data was collected in relation to current and future market developments.

Critical assessment of the current business situation
After consistently positive trends were seen in the assessment of the current business situation in 2021, this has slipped since 2022. There is still no sign of a trend reversal in the current survey. The reasons for the negative sentiment are manifold and were already evident in the last survey.

At present, politicians do not seem to be able to create a more positive environment for the industry with appropriate measures. Overall, Germany in particular, but also Europe, is currently experiencing a very difficult market environment.

However, the main drivers of the current difficult situation are likely to be the persistently high energy and commodity/raw material prices. In addition, there are still problems in individual areas of the logistics chains, for example on the main trade/container routes, as well as a cautious consumer climate. A slowdown in global trade and uncertainties in the political arena are currently fueling the negative mood in the market.

Despite rising registration figures, the automotive industry, the most important application area for composites, has not yet returned to its former volume. The construction industry, the second most important key area of application, is currently in crisis. Although the order books are still well filled, new orders are often failing to materialize. High interest rates and material costs coupled with the high cost of living are having a particularly negative impact on private construction, but public construction is also currently unable to achieve the targets it has set itself. According to the ZDB (Zentralverband Deutsches Baugewerbe), the forecasts in this important sector remain gloomy: "The decline in the construction industry is continuing. Turnover will fall by 5.3% in real terms this year and we expect a further 3% drop next year. Residential construction remains responsible for the decline, which will slump by 11% in real terms this year and continue its downward trajectory at -13% in 2024."

It is not only the assessment of the general business situation that remains pessimistic. The situation of their own companies also continues to be viewed critically. The picture is particularly negative for Germany. Almost 50% of respondents are critical of the current business situation in Germany. The view of global business and Europe is somewhat more positive. Here, "only" 40% and 35% of respondents respectively assess the situation rather negatively.

Future expectations brighten
Despite the generally rather subdued assessment of the business situation, many of those surveyed appear to be convinced that the mood is improving, at least in Europe. When asked about their assessment of future general business development, the values for Europe and the world are more optimistic than in the last survey. The survey participants do not currently expect the situation in Germany to improve.

Respondents were more optimistic about their own company's future expectations for Europe and the global market.

The participants seem to be assuming a moderate short to medium-term recovery of the global economy. The forecasts are more optimistic than the assessment of the current situation. It is striking that the view of the German region is more critical in relation to Europe and the global economy. 28% of those surveyed expect the general market situation in Germany to develop negatively. Only 13% expect the current situation to improve. The figures for Europe and the world are better.

Investment climate remains subdued
The current rather cautious assessment of the economic situation continues to have an impact on the investment climate.

While 22% of participants in the last survey still assumed an increase in personnel capacity (survey 1/2023 = 40%), this figure is currently only 18%. In contrast, 18% even expect a decrease in personnel.

The proportion of respondents planning to invest in machinery is also declining. While 56% of respondents in the last survey still expected to make such investments, this figure has now fallen to 46%.

Different expectations of application industries
The composites market is characterized by a high degree of heterogeneity in terms of both materials and applications. In the survey, the participants are asked to give their assessment of the market development of different core areas.

The expectations are extremely varied. The two most important application areas are the mobility and construction/infrastructure sectors. Both are currently undergoing major upheavals or are affected by declines, which is also clearly reflected in the survey. Growth is expected above all in the wind energy and aviation sectors.

Growth drivers with slight shifts
In terms of materials, there has been a change in the assessment of growth drivers. While the respondents in the last 9 surveys always named GRP as the material from which the main growth impetus for the composites sector is to be expected, the main impetus is now once again expected to come from CFRP or across all materials.

There is a slight regional shift. Germany is seen less strongly as a growth driver. In contrast, Europe (excluding Germany) and Asia are mentioned significantly more.

Composites index points in different directions
The numerous negative influences of recent times continue to be reflected in the overall Composites Index. This continues to fall, particularly when looking at the current business situation. On the other hand, there is a slight improvement in expectations for future market development, although this remains at a low level.

The total volume of processed composites in Europe in 2022 was already declining, and a further decline must also be expected for 2023. This is likely to be around 5% again.

It remains to be seen whether it will be possible to counteract the negative trend. Targeted intervention, including by political decision-makers, would be desirable here. However, this cannot succeed without industry/business. Only together will it be possible to maintain and strengthen Germany as a business/industry location. For composites as a material group in general, there are still very good opportunities to expand the market position in both new and existing markets due to the special portfolio of properties. However, the dependency on macroeconomic developments remains. It is now important to develop new market areas through innovation, to consistently exploit opportunities and to work together to further implement composites in existing markets. This can often be achieved better together than alone. With its excellent network, Composites Germany offers a wide range of opportunities.

The next composites market survey will be published in July 2024.

• Results of the 21st Composites Market Survey
• Critical assessment of the current business situation
• Future expectations turn negative
• Expectations for application industries vary
• Growth drivers with only slight shifts
• Composites index points in different directions

This is the 21^st time that Composites Germany (www.composites-germany.de) has identified the latest performance indicators for the fibre-reinforced plastics market. The survey covered all the member companies of the umbrella organisations of Composites Germany: AVK and Composites United, as well as the associated partner VDMA.

As before, to ensure a smooth comparison with previous surveys, the questions in this half-yearly survey have been left unchanged. Once again, the data obtained in the survey is largely qualitative and relates to current and future developments in the market.

Critical assessment of current business situation
After consistently positive trends were evident in the assessment of the current business situation in 2021, this slipped in 2022. For the third time in a row, the current survey shows pessimistic assessments. The reasons for the negative mood are manifold. However, the main drivers are likely to be the still high energy and commodity prices. In addition, there are still problems in individual areas of the logistics chains as well as a restrained consumer climate. Despite rising registration figures, the automotive industry, the most important application area for composites, has not yet returned to its former volume. This also illustrates the change in strategy of European OEMs to move away from volume models towards high-margin vehicle segments. The construction industry, the second central area of application, is currently in crisis. Although the order books are still well filled in many cases, new orders are often not forthcoming. High in-terest rates and material costs combined with a high cost of living are placing a heavy burden on private construction in particular. A real decline in turnover of 7% is currently expected for the construction industry in 2023.

The assessment of the business situation of their own company is also increasingly pessimistic. The picture is particularly negative for Germany. Almost 50% of respondents (44%) are critical of the current business situation. The view of global business and Europe is somewhat more positive. Here, "only" 36% and 33% of the respondents respectively assess the situation rather negatively.

Future expectations turn negative
Following the rather pessimistic assessment of the current business situation, future business expectations also turn negative. After an increase in the last survey, the cor-responding indicators for the general business situation are now clearly pointing down-wards. The respondents are also more pessimistic about their own com-pany's future expectations.

The participants apparently do not expect the situation to improve in the short term. It is also noticeable here that the view of Germany as a region is more critical in relation to Europe and the global economy. 22% of the respondents expect a negative develop-ment in Germany. Only 13% expect the current situation to improve. The indicators for Europe and the world are better.

Investment climate clouds over
The currently rather cautious assessment of the economic situation and the pessimistic outlook also have an impact on the investment climate.
Whereas in the last survey 40% of the participants still expected an increase in person-nel capacity, this figure is currently only 18%. On the other hand, 12% even expect a decline in the area of personnel.

The share of respondents planning to invest in machinery is also declining. While 71% of respondents in the last survey expected to invest in machinery, this figure has now fallen to 56%.
 
Expectations of application industries differ
The composites market is characterised by strong heterogeneity, both in terms of materials and applications. In the survey, the participants were asked to give their assessment of the market development in different core areas. The expectations are extremely varied.

The weaknesses already described in the most important core markets of transport and construction/infrastructure are clearly evident. Growth is expected above all in the wind energy and aviation sectors. Expectations about future market developments, on the other hand, are significantly more positive than the figures presented here might suggest.

Growth drivers with only slight shifts
The paradigm shift in materials continues. While in the first 13 surveys the respondents always named CFRP as the material from which the main growth impulses for the com-posites sector are to be expected, the main impulses are now assumed to come from GRP or across all materials. There is a slight regional shift. At present it is mainly North America that is expected to provide the main growth impulses for the industry. Europe and Asia are losing ground slightly.

Composites index points in different directions
The numerous negative influences of recent times are now also reflected in the overall composites index. All indicators are weakening. Both the current and the future assessment are turning negative.  

The total volume of composites processed in Europe in 2022 was already slightly down compared to 2021. After a good first quarter of 2022, there is currently a clear cooling of activity. It remains to be seen whether it will be possible to counteract the negative development. Targeted intervention, including by political decision-makers, would be desirable here. However, this cannot succeed without industry/business. Only together will it be possible to further strengthen Germany's position as a business location and to maintain or expand its position against the backdrop of a weakening global economy. There are still very good opportunities for composites to expand their market position in new and existing markets. However, the dependence on macroeconomic developments remains. The task now is to open up new market fields through innovations, to consistently exploit opportunities and to work together to further implement composites in existing markets. This can often be done better together than alone. With its excellent network, Composites Germany offers a wide range of opportunities.

• Highly positive rating of current business situation
• Future expectations are optimistic
• Varied expectations for application industries
• Still the same growth drivers

This is the seventeenth time that Composites Germany has identified the latest KPIs for the fibre-reinforced plastics market. The survey covered all the member companies of the three major umbrella organisations of Composites Germany: AVK (Industrievereinigung Verstärkte Kunststoffe e.V.), Leichtbau Baden-Württemberg and the VDMA Working Group on Hybrid Lightweight Construction Technologies.

As before, to ensure a smooth comparison with the previous surveys, the questions in this half-yearly survey have been left unchanged. Once again, the data obtained in the survey is largely qualitative and relates to current and future market developments.

Highly positive rating of current business situation
After ratings of the current business situation had been steadily declining for nearly two years in succession, last year’s survey already displayed a trend reversal towards a more positive outlook. This positive trend has now continued in the latest survey, with entirely positive ratings for all three regions (Germany, Europe and worldwide). For ex-ample, 80% described the current general business situation as either positive or indeed very positive.

Moreover, unlike in the last survey, this more optimistic assessment applies not only to the general business situation, but also to the respondents’ own businesses, as they gave even more positive ratings than last year.     

There are currently quite a few challenges in the industrial environment. In many cases, the Covid-19 pandemic, for example, has merely receded, but has not disappeared.      
Business models have been and are still requiring adjustments. In some cases, supply chains have been severely disrupted and there are still some serious bottlenecks. The blockage of the Suez Canal by the Ever Given has once again highlighted the vulnerability of international commerce.

Shortages of raw materials, sharp increases in the prices of many raw materials and, most recently, a shortage of chips are having a major impact on various application industries. Nevertheless, the overall picture in the composites in-dustry is extremely optimistic. Similarly positive ratings were last achieved in the autumn 2018 and spring 2019 surveys.

Future expectations are optimistic
The positive prevailing mood is further reinforced by positive expectations for the future. A consistently optimistic picture emerged when respondents were asked about their ex-pectations for future business developments. For example, more than 80% of respond-ents are expecting the business situation in Europe to improve over the next six months. The pattern is similar for the other regions.

Varied expectations for application industries
Expectations on selected application industries vary substantially. As in the previous survey, significant declines are expected, above all, in automotive, aviation and wind energy. However, we can see that the proportion of respondents giving more pessimistic assessments has once again declined significantly.
Whereas, in the last sur-vey, 46% were expecting to see the situation get worse in aviation, this value has now dropped to a “mere” 17%. In the automotive sector, it has dropped from 17% (second half of 2020) to only 14%.

Two areas of application, in particular – infrastructure/construction and sports/leisure – have long been seen by many respondents as major growth stimulants for the composites industry. Even in times of a more difficult industrial environment, these two areas are currently proving to be especially robust.

GRP is still a growth driver
As before, the current market survey shows Germany, Europe and Asia as the global regions expected to deliver the most important growth stimuli for the composites segment. Expectations for Asia, on the other hand, have declined somewhat in favour of Europe. Where materials are concerned, we are seeing a continuation of the ongoing paradigm shift.      

Respondents are still convinced that CRP (carbon fibre reinforced plastic) is losing ground as a growth driver. However, GRP (glass fibre reinforced plastic) is now ranking as the most important material for the third time in succession. A large number of respondents have also mentioned the area entitled “Across All Segments” this time.

Composites are still relatively young materials with a great deal of potential. It remains exciting to see to what extent composites will continue to emerge as alternative materials and whether they can benefit from the major forthcoming developments (e.g. alternative drives, a growing demand for sustainability, alternative power sources, 5G, etc.).
The next Composites Market Survey will be published in January 2022. 

• Premiere: “Process live” format
• Lightweight Technologies Forum to present hybrid lightweight construction
• Trade fair kick-off event: International Composites Congress (ICC)

In the competition of lightweight construction and design materials, composites are among the winners – automotive engineering, aerospace, wind energy, boatbuilding and construction can no longer do without glass- and carbon-fibre reinforced plastics (GFRP & CFRP). Nevertheless, the greatest impetus right now is coming from the composites industry itself: technological advancements in the process chain. From 6 to 8 November, COMPOSITES EUROPE in Stuttgart will drive home that point.

Trade fair visitors will meet more than 350 exhibitors from 30 countries who in Stuttgart will present state-of-the-art technology and the potential of fibre-reinforced composites – in the exhibition area as well as in numerous event areas, lecture forums and themed tours.

With the new “Process live” format, coordinated processing and manufacturing processes will become the visible focus of this year’s COMPOSITES EUROPE. Mechanical and plant engineering companies will get together in group exhibits to showcase their technologies in live interactions – thus enabling visitors to experience sub-processes presented in a larger context.

Partnerships in the process chain accelerate growth in the industry
Among others, the cutting specialists Gunnar (Switzerland), the composites automation experts Airborne (Netherlands) and the gripping systems providers Schmalz (Germany) will join forces to create a combined production cell in a process-safe depiction of the entire value chain from roller materials to the finished layer structure of a composite component. In this setup, interlocking hardware components are fully connected with each other via software. “Cooperation among processors is getting closer and closer. These partnerships within the process chain are accelerating the growth of the composites industry; that’s what we want to show with the new ‘Process live’ format”, says Olaf Freier, event director of COMPOSITES EUROPE.

Lightweight Technologies Forum: Platform for multi-material lightweight construction
Besides the optimisation of the process chain, industry research today is heavily focused on the use of GFRP and CFRP in multi-material systems. The Lightweight Technologies Forum will once again demonstrate how composites play to their strengths alongside other materials in the material mix for hybrid structural components. A total of 16 exhibitors will present materials, tools and exhibits here – from fillers to bonding agents and presses for laminating different materials to semi-finished hybrid products.

In various presentations, experts will provide an overview of new products in manufacturing and joining technology as well as applications and lightweight engineering references from the automotive, aerospace and construction sectors. Support for the Lightweight Technologies Forum is provided by the German Federal Ministry for Economic Affairs and Energy.

From digitalisation to recycling: Know-how in the supporting programme
A presentation programme, themed tours and special areas complete the COMPOSITES EUROPE lineup. Manufacturing technology, recycling, digitalisation and thermoplastics will be central themes in the programme of the COMPOSITES Forum, which will also feature exhibitors presenting application examples from automotive engineering, aerospace, construction, mechanical engineering, wind energy and shipbuilding.

Themed guided tours, meanwhile, will lead visitors straight to the stands of selected exhibitors ready to explain the latest innovations in fibreglass, thermoplastics, automotive engineering, wind energy and construction.

Special areas and group stands to highlight new ideas
Hosting the special area “Industry meets Science”, the Institute of Plastics Processing (IKV), the leading European research institute for plastics technology based in Aachen, will showcase developments in process technology, design, quality assurance and repair.

The exhibitors at the “Bio-Based Composites Pavilion”, which will again be set up in cooperation with the nova-Institute, will reflect the development of the market for green composites. The focus will be on application options of wood-polymer composites (WPC), natural fibre composites (NFC), bio-based thermoplastics and thermosets for composites, and bio-based plastics.

Moreover, numerous young companies will thrill visitors with fresh ideas: the industry newcomers will present themselves at a group stand funded by the Federal Ministry for Economic Affairs and Energy (BMWi). They will cover a wide range of topics from semi-finished carbon-fibre products to metal foams to production lines for multi-material 3D fibre laminates.

Even the automotive experts of tomorrow will have their own forum at the trade fair: under the banner of “Formula Student”, students and apprentices will show visitors racecars they themselves have designed.

Kick-off event: 4^th International Composites Congress (ICC)
The International Composites Congress (ICC) will once again kick off COMPOSITES EUROPE. In a series of presentations starting the day before the trade fair (5 and 6 November), international experts at the event with the headline topic “Composites – On the Path to Becoming a Key Industry?” will speak about and discuss applications, materials, process technologies and market prospects.