Economic environment and business performance

Macroeconomic conditions

According to data from the Organisation for Economic Co-operation and Development (OECD), the global economy only managed muted growth over the reporting period. Adjusted for inflation, the OECD countries’ gross domestic product (GDP) rose by 0.6 per cent in the first quarter and by 1.0 per cent in the second quarter. This slight uptrend continued through the summer. Economic conditions improved somewhat in the European Union. The economy contracted by 0.8 per cent in the first three months, followed by close to zero growth (contraction of 0.2 per cent) in the second quarter. This trend was driven primarily by Germany, France and the United Kingdom. However, the negative growth rates in Italy and Spain, two major European economies, show that the eurozone has not yet overcome the crisis. This is also hampering growth in other European countries, including Russia.

Among the emerging markets, China’s growth rates were almost as high as in the previous year, whereas other Asian markets experienced a decline. Brazil’s upward trend continued, although the pace of economic growth tailed off and there were considerable exchange-rate fluctuations. Although growth rates have slowed down in many emerging markets, they will continue to be significant in driving global economic expansion in the medium term.

Besides GDP growth, global demand for machinery and equipment is largely driven by investment confidence and world trade volumes. Over the course of the year, however, worldwide spending on capital equipment has increased only cautiously as ongoing uncertainty about growth prospects has continued to dampen companies’ willingness to invest, particularly in the eurozone. Economic research institutes estimate that global trade in 2013 as a whole will once again be well behind the medium-term trend.

Sectoral conditions

The global market for industrial trucks maintained its uptrend in the third quarter. In the first nine months, the number of new trucks ordered was up by 5.0 per cent year on year, while the increase in the period July to September was even higher at 7.5 per cent. More than half of the rise in the nine-month period was attributable to the Chinese market, which continued to rally in the third quarter and achieved double-digit growth rates in the period under review.

Western Europe’s slight downward trend continued in the third quarter. Falling sales in the United Kingdom, Italy and Germany all contributed to this, although France and Spain generated year-on-year growth. Reticence to invest continued to stand in the way of companies’ renewal of their ageing truck fleets. By contrast, eastern Europe followed a subdued second quarter with healthy growth in the third quarter, above all thanks to growth in Poland and the Czech Republic. However, Russia’s sales figures were only slightly higher than in the corresponding period of last year owing to the weakness of the third quarter.

Procurement markets and conditions in the financial markets

Commodity prices have a direct impact on around 25.0 per cent of the cost of the materials needed to manufacture an industrial truck in the KION Group.

In the first nine months of 2013, purchase prices for steel and energy were generally down on the same period of 2012. However, the price of Brent crude oil, which is quoted in US dollars and affects the price of other fuels, went up again considerably in the third quarter owing to the crisis in Syria and the average price over the nine-month period was just 3.3 per cent below the price for the comparable period of last year.

The pound sterling depreciated against the euro. The value of the Brazilian real fell further in the third quarter, and Brazil’s central bank intensified its intervention programme considerably in order to curb the decline. China’s renminbi has proved comparatively stable over the year so far.

Level of orders

The KION Group’s brand companies received orders for a total of 105.9 thousand new industrial trucks in the first nine months of 2013. This year-on-year decrease of 1.1 per cent was predominantly attributable to the weakness of the western European market, which remains the KION Group’s largest market. The number of trucks ordered in the third quarter in Germany and the rest of western Europe was slightly below the comparable period of 2012, whereas new truck sales in the emerging markets – especially in eastern Europe, China and Brazil – remained at a highly positive level. In terms of units they accounted for 35.0 per cent of the trucks ordered in the reporting period.

Order intake totalled € 3,296.6 million, just 2.6 per cent short of its value in the corresponding period of the previous year (excluding hydraulics activities). The order book remained at a healthy level and was worth € 693.9 million at the end of the third quarter.