Conditions are right in the machine tool industry to face the approaching challenges / AMB provides important impetus in even-numbered years
 
After the Brexit shock, the VDW (German Machine Tool Builders' Association) above all expects orientation from AMB, the international exhibition for metal working, from 13 to 17 September in Stuttgart. Dr. Wilfried Schäfer, Director of the VDW, is sure that this German showcase sector will be able to maintain and extend its worldwide leading position in the future too. In the interview, he demands that politicians reduce bureaucracy and increase research funding for medium-sized companies. The association will take part in AMB with the "Special show for young people" of its VDW young people's foundation in the atrium at the East Entrance. In Hall 4, the IndustryArena will demonstrate a process chain in the "Innovation Park" together with the control system manufacturer Heidenhain. In the associated technical forum, exhibitors will provide information on software engineering aspects of production.
 
Dr. Schäfer, what does Brexit mean for the German machine tool industry?
 
Politically, the British vote to leave the EU is a shock. It will lead to general uncertainty in the European economy and a loss of faith on the part of international business partners. It will depend to a large extent on the timetable of events from now, and on how fast the political leaders are able to successfully reassure markets and investors. To a certain extent, these factors will also determine whether the German machine tool industry will be able to achieve its growth in production of one per cent in the current year. Last year, Great Britain was the 11th most important market for the sector, with a trade volume of around 313 million Euro. There is also concern regarding the smooth exchange of products and services between German manufacturers and their British subsidiaries. Quite a few companies have invested in the UK trusting in stable framework conditions. The conditions under which their business model will function in the future is so far completely unclear.
 
Beyond Brexit, what are the greatest challenges and opportunities for machine tool manufacturers?
 
The machine tool industry is in a very good situation to be able to cope with all the approaching challenges. With an export share of around 70 per cent, it is so well placed worldwide that it can rapidly meet rising demand everywhere. This is also necessary because, in view of the upheavals in many markets and the weak Chinese demand, new growth markets must be identified and developed in a sustainable manner. I am thinking, for example, of the ASEAN region, India, Mexico or Iran. Another challenge is to generate new offers from the potential of networking in the companies in order to strengthen the technical competitive edge with regard to machines. However, the tight network of research facilities and competent partners at suppliers and customers provides optimum conditions to assert our claim of technical leadership in machines and technologies, complemented by new services, in the future too.
 
Politics plays a role in determining the most important framework conditions. How can the industry be supported?
 
The medium-sized machine tool manufacturers would benefit if public funds for research were increased. At present, there is inadequate funding of larger medium-sized companies of between 500 and 2000 employees, which is the typical size of companies in the machine tool industry. They do not come within the EU definition of medium-sized companies, so are off the radar of all programmes.
Another problematic factor that frequently obstructs the sector's export business is export controls. Regulations applicable to conventional armaments have just been adjusted to industrial reality in the so-called Wassenaar arrangement. 5-axis machines were removed from the list of machines subject to authorisation, because they are made in many countries and can be obtained without problem. However, there is still no consent yet as to whether this will also apply to nuclear technology in the so-called NSG or Nuclear Suppliers Group. A standardised, business-friendly regulation would nevertheless lead to a considerable simplification of red tape for our sector. If this is not achieved, there will be a significant rise in administrative work and costs for companies.
 
How does your association see the CETA and TTIP trade agreements, which are a controversial issue to the public - opportunity or risk?
 
Bilateral trade agreements have shown in the past too that business between the countries concerned can gain an enormous impetus, for example South Korea. The USA is our second most important market. Canada also has potential. In view of the currently difficult economic situation, positive impulses, such as would without doubt be generated by TTIP or CETA, can only help.
 
Against this background, where in your view will the machine tool industry be in five or ten years' time? Will it be able to defend its leading role?
 
We are very optimistic that the sector will be able to maintain and improve its leading role. The preconditions are, among other things, continual efforts in research and development and the sustainable development of growth markets.
 
What impetus do you expect from AMB 2016, what will be the main areas of focus of your association members at the exhibition?
 
In even-numbered years, AMB provides its visitors with an ideal platform to prepare investments in production technology. We expect the approaching AMB to provide information on the situation regarding willingness to invest in Germany and Europe for the rest of the year.