German machinery businesses hope for upturn as orders improve

Sentiment across Germany's mechanical engineering sector has brightened slightly, after orders improved slightly in 2025 following a years-long slump, a trade group said on Wednesday.

Orders were flat last year compared with 2024, an improvement following three consecutive years of falling orders, the Association of German Mechanical and Plant Engineering (VDMA) said in a statement.

The export-oriented industry was able to compensate for losses in the domestic market and outside the eurozone with more orders from countries of the 21-member currency area.

Overall, German machinery businesses are more confident regarding the future following the latest development, the VDMA said.

"There are increasing signs that the German mechanical and plant engineering industry has reached the bottom of its economic slide," said VDMA chief economist Johannes Gernandt, pointing to a rise in orders in the fourth quarter.

Between October and December, orders were up by 3% in real terms driven by demand from abroad.

For 2026, the industry group continues to forecast small growth in production of 1% in real terms, Gernandt said.