Germany’s beleaguered industrial sector capped a ‘lost year’ with a further decline in December – helping to pull eurozone output back.
French factories also suffered a bleak end to 2024 with the worst month since the peak of the pandemic, while political chaos rages.
The decline of Europe’s two largest economies, along with Italy’s number three, has resulted in sector contraction across the eurozone.
The closely watched purchasing managers’ index (PMI) was 45.1 on the scale where 50 separates growth from contraction.
Germany posted 42.5 as it saw a ‘sharp and accelerating decline in output and new orders’ and further contraction in employment.
Its once powerful industrial base has been in turmoil after it lost access to cheap energy from Russia as a result of the war in Ukraine and falling demand from China.
Strike: Germany’s industrial base has been in turmoil after losing access to cheap energy from Russia, sparking industrial unrest such as protests by Volkswagen workers (pictured)
Its giant auto industry is struggling with cut-price Chinese imports.
This prompted cost-cutting and industrial unrest, such as protests by Volkswagen workers.
And it finds itself in political limbo ahead of next month’s election after its coalition government fell.
Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, which compiled the latest figures, said: ‘The situation is still quite bleak. The industry will not come out of recession anytime soon.
‘The reduction in backlogs suggests that the new year is not going to get off to a much better start. It was a lost year.’
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