Italian machinery firms prepare for post-K gains

“The K show is a very important event for Italian companies and the Italian group – including machinery and materials companies – will be the second largest after Germany,” he said at a pre-fair briefing in Milan this week.

The global downturn meant tha production of plastics and rubber processing machinery in Italy declined by 21.4% during 2009, from €4.2bn in 2008 to €3.3bn. Colombo, who is also managing director of Milan-based plastics compounding equipment producer Icma San Giorgio, said that best estimates suggest it may be three years at least before Italian machinery producers return to pre-downturn levels. However, he said the sector appears to be on the road to recovery.

“Each month we survey our members to get their feeling about order intake and the general feeling is that things are improving. But the world is a different place to 2007,” he said.

“The real point is how the market was financed in 2007. There was a lot of money around then and that money is not going to be around in the future. That is why we see a slow recovery.”

In its most recent sector survey, carried out earlier this month, Assocomaplast reported that 45% of those responding expect to see sales growth in the seond half of 2010 and 43% forecast stability. And more than 70% report monthly year-on-year performances ahead of 2009.

Colombo is clear that there are still potential clouds on the horizon for the sector – situations such as that arising recently in the Greek economy could emerge in other markets and the Euro/dollar exchange rate may move unfavourably. And the positive stimulus from the Italian Tremonti-ter investment incentive scheme is also coming to an end. However, the outlook is generally seen as favourable for 2010 for the Italian plastics machinery makers.

“If the trend continues as we see now I think [the Italian machinery sector] could arrive close to two digit growth – 8-9%,” said Colombo.

That figure is a little more cautious than the recent prediction of 11% from the VDMA, the trade association that represents Germany’s plastics and rubber machinery manufacturing industry. Assocomaplast director general Mario Maggiani attributes this to Germany’s more established presence in Asia.

“Germany has a stronger presence in China and India in both export and local production. You can count on one hand the Italian companies producing in China,” he said.

However, Maggiani said that Italian companies are much better positioned than their European rival in the fast growing Brazilian market. In fact, he said latest Assocomaplast data shows that for the first six months of 2010 Brazil has been the second biggest market for Italian plastics and rubber machinery markets (10%), just behind Germany (11.6%) but ahead of France (8.9%), China (7.4%), US (5.8%), Russia and the UK (5.3% each).

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