Industry experts say that the European injection molding machine market will shrink in the next few years, up to 10%.
Cesar Rodriguez Gabilondo, CEO and founder of MachinePoint Consulting, said that overcapacity and falling demand for plastics could lead to a 10% overall downward revision of the injection molding machine industry in Europe. Product prices will fall as demand falls.
Rodriguez said: 'I may be wrong, but it is expected that from 2019 to 2020, the crisis in the injection molding machine industry will be triggered by a 2-3% contraction in demand, and the industry faces global risks.'
He believes that these risks include the trade war, the unsuccessful Brexit, the Italian euro crisis, the immigration crisis, the stagnation of emerging markets (such as Turkey) and the high oil prices brought about by sanctions against Iran.
He said: 'In the past 8 years, the output of injection molding machines has increased by 26%, but the manufacturing of non-durable goods in the European market has only increased by 6%. 'He added that orders in the second half of 2017 and the first half of 2018 also Further, the global production capacity has increased significantly. At the same time, the production of plastic products in 19 EU countries has been stagnant in 2017, only increasing by 0.57%.
The European Plastics and Rubber Machinery Manufacturers Association (EUROMAP) report and EU statistics also show that injection molding machine production increased by 7% in 2017. The German plastics trade group VDMA predicts an increase of 4% in 2018.
Rodriguez believes that part of the reason for over-expansion is that European governments encourage increased capacity and price competition in the industry.
This includes Italy's large-scale capital investment in Industry 4.0, and the Hungarian government has also provided unsatisfactory subsidies for the investment in the industry. Rodrigue added: 'Norway is another example. Last year, the output of injection molding machines was higher than that of manufacturing capacity. 100%. '
But such a large-scale stimulus has brought about a huge market imbalance. Like the steel market, the G20 countries have suspended subsidies to the industry in the case of oversupply in China. Rodriguez believes that the plastics industry is also overcapacity.
He pointed out: 'All of this has led to an unreasonable industrial surplus, which is what drives the global production of non-durable consumer goods and is part of the reason for the global low inflation.'
MachinePoint Consulting is headquartered in Vladido, Spain, which markets, sells and transfers used machinery for the plastics, packaging, food and beverage industries.
Rodriguez's point of view echoes the warning given by Euromap, which stated that although the current order is full, there is a downside risk in the market. At the conference held on June 15 this year, Euromap pointed out that the delivery time was extended and the skilled workers lacked the possibility. This has led to a slowdown in the growth of the injection molding machine industry, although it has experienced 'extra long-term prosperity'.