Uncertain forecasts
22 June 2016It’s a typically unreliable summer here in London: last week we needed the heating on, yesterday there was torrential rain in the morning and bright sunshine in the evening. It’s the sort of summer where whatever clothes you put on in the morning, you’ll be cursing your choice by the afternoon; it’s almost a relief when the long grey drizzling British winter comes and you at least know to dress for another cold wet day.
In the sectors covered by both of our lifting magazines, Hoist and Cranes Today, I see the same hard to forecast conditions. I am not alone in that. Our features writer, Keren Fallwell, visited Cemat in Hannover recently. Talking after the show, she described to me an industry that seems far from certain of what to expect.
Overall, the exhibitors Keren met told her that business was good; however, a number cited low oil and commodity prices as cause for concern.
Beyond that broad background to market uncertainty, there are some specific contingencies that will impact confidence over the summer. Here in Europe, the position of Britain in the EU will be unclear until the referendum is completed. Regardless of what may be best for Britain, I think it’s fair to say the potential withdrawal of one Europe’s biggest economies threatens the entire EU project. With the union already battered by a poorly designed single currency and wide disparities in economic performance, Brexit could be the trigger for its complete collapse.
Across the Atlantic, the US presidential elections introduce more uncertainty. It’s always the case that buyers hold back a little as an election approaches, and often the actual result has little real impact on the market. I think this time though, with one party’s candidate so far from normal political conventions, the voters’ choice may make a big difference to the economy.
At Cemat, Keren tells me, there was broad support for the ‘Industry 4.0’ concept promoted by the German government. I’m dubious that this is much more than a branding exercise (the ‘4.0’ naming, for example, seems like a dated 20th century attempt to ride on the coattails of the software development industry, rather than an identification of actual revolutionary change), but in as much as it encourages efficiency through better communication between process equipment, I am sure it will give companies a little more flexibility. That will make it easier to respond rapidly to a deeply uncertain market.
The future of Cemat itself seems to me a little uncertain. Looking at the event’s website, it’s clear that even their own photographers failed to find any crowds. Typically, the press teams for events like this will claim record attendances every show, with visitors from every corner of the globe. At Cemat this year, the best they could say was they had a higher percentage of overseas visitors: clearly that can be read as meaning only that the number of domestic visitors numbers fell faster than that of foreign visitors. Hopefully, with the 2018 show taking place alongside Hannover Messe, this decline will be stalled.
