German industry concerned over supply shortages

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Staff wear protective masks at the Volkswagen assembly line in Wolfsburg, Germany, April 27, 2020. Swen Pfoertner/Pool via REUTERS/File Photo
Staff wear protective masks at the Volkswagen assembly line in Wolfsburg, Germany, April 27, 2020. Swen Pfoertner/Pool via REUTERS/File Photo

German industry is increasingly concerned about bottlenecks in supplies as they watch their stocks of raw materials and primary products decline, the Ifo economic research institute reported on Monday.

A recent Ifo survey revealed that 64 per cent of companies were worried about supply problems, with one major concern being the shortage of semiconductors and integrated circuits, or chips.

The situation had worsened from that in the previous quarter, Ifo said after surveying some 2,700 companies in July.

“Another problem is the sharp rise in some purchase prices,” Ifo’s Klaus Wohlrabe said.

As many as 83 per cent of vehicle manufacturers and 84 per cent of electrical equipment manufacturers reported shortages in semiconductors and chips.

Sharp rises in plastic granulates were posing problems for manufacturers in rubber and plastics, where 79 per cent reported problems.

The situation was similar with manufacturers of electronic devices and mechanical engineering companies with 72 per cent and 70 per cent respectively reporting problems.

“This could jeopardize the economic recovery,” Wohlrabe said.

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