Macroeconomic and sector-specific conditions

Macroeconomic conditions

The global economy grew at a stable rate in the first half of 2017. This is due to the upward trend in industrialised countries, which is being bolstered by foreign trade and companies’ rising capital expenditure. On the whole, emerging markets and developing countries are also benefiting, albeit to varying degrees, from the expansion of global trade and from the recovery of commodity prices. According to the International Monetary Fund (IMF), growing protectionism continues to represent the biggest risk.

Sectoral conditions

Sales markets

The global market for industrial trucks continued to expand rapidly in the second quarter. Overall, the number of new trucks ordered in the first half of this year was up by 17.4 per cent compared with the prior-year period. The total number of trucks ordered across all regions and product types was 694.1 thousand (H1 2016: 591.0 thousand).

The EMEA region (western Europe, eastern Europe, Middle East and Africa) generated growth of 11.4 per cent. In western Europe (growth of 9.1 per cent), orders in France and Spain rose at an exceptionally strong rate. The increases in Germany and Italy were more moderate, however, while the United Kingdom saw no growth. All of the major markets in eastern Europe (growth of 27.3 per cent) achieved significant rises, with Russia performing particularly well. Orders in North America, Central America and South America (Americas region) were up by 9.0 per cent overall, driven primarily by increases in the United States and by the recovery of the Brazilian market. Asia-Pacific (APAC region) notched up substantial growth in the second quarter, and its overall increase in the first half of the year was 29.0 per cent. The bulk of the additional demand came from China.

In terms of volume increases, the biggest rise was attributable to IC trucks, which were up by 20.8 per cent in the first half of the year and benefited from strong demand in China. Orders for electric forklift trucks increased by 15.0 per cent, while those for warehouse equipment rose by 15.6 per cent. > TABLE 02

The rapid expansion of e-commerce and the increasingly widespread use of Industry 4.0 technologies continue to provide a boost for warehouse systems and automation solutions. Companies at every stage of the supply chain are facing growing demands in terms of the availability of goods, the accuracy and speed with which orders are processed, smaller orders, and peaks in ordering activity. In the first half of 2017, many companies continued to invest heavily in expanding their warehouse capacity and in automated warehouse systems in order to protect their future competitiveness. These systems include not only solutions for individual processes, such as picking and packing, but also fully integrated end-to-end solutions.

Procurement markets and conditions in the financial markets

Steel, the most important commodity for the KION Group, became significantly more expensive in the first half of 2017 owing to rising prices for coking coal and iron ore and to the introduction of punitive tariffs on cheap imports in the European Union. Prices for copper and oil were also above their average for the corresponding prior-year period. The price of rubber rose sharply and was significantly higher at the end of June 2017 than it had been a year earlier. Producer prices for intermediate goods in the eurozone were also generally more expensive.

Overall, currency effects had a negative impact on the KION Group’s business situation in the first half of 2017. In the first six months of this year, the euro was approximately 2 per cent higher on average year on year against the Chinese renminbi and around 10 per cent higher against pound sterling. By contrast, the euro depreciated by roughly 3 per cent against the US dollar and by around 16 per cent against the Brazilian real in the same period.