Injection molding machine builder Arburg GmbH + Co KG expects to generate sales of about €620 million ($676 million) in 2024, down €164 million ($178.9 million) from €784 million in 2023, which was down from €875 million from 2022.
That's when sales started declining compared with the pandemic-induced machine buying sprees of 2020 and 2021, which were fueled by the medical market responding to demand from COVID-19 while consumer goods manufacturers dealing with locked-down consumer spending sprees.
High energy prices, which have doubled in recent years in Germany, where the company does 30 percent of its sales, also have contributed to the slowdown.
"In 2024, there were some sporadic success stories thanks to a number of attractive projects, but the situation in terms of incoming orders remains weak," said Steffen Kroner, Arburg's managing director of finance, controlling, information technology and human resources.
Still, Kroner sees a silver lining.
"We are ideally positioned and will emerge from this crisis in a stronger position as a solution partner for sustainable plastics processing," he said.
Kroner also pointed to the strength of the families that have owned and operated Arburg for 101 years, the company's committed workforce and innovative products.
Just like other companies in the industry, Arburg is navigating a challenging economic landscape.
"I can say this much, however: Arburg would not be Arburg if we were not looking ahead positively to the future despite the difficult environment," Kroner said.
For now, there are no signs of a significant short-term improvement, according to Tobias Baur, managing director of sales and after sales.
"The market weakness affects all regions and industries almost equally. However, shifts and small trends are of course recognizable," Baur said.
Regionally, sales in Europe are fairly flat with a "small ray of hope" in Eastern Europe, he noted.
Elsewhere, Baur said, Arburg officials see weaknesses in market developments in the Americas, including the United States, and "major challenges" in Asia due to weakness in China.
In terms of end markets, the mobility sector, which is essentially the automotive industry, is still weak while the electronics/electrical industry has lost strength but remains at a good level. The medical and packaging sectors are relatively stable, Baur said.
Automation and turnkey solutions have become an important pillar of Arburg's business and the after-sales business is on a par with the previous year.
"This shows that our customers are producing, but are currently acting cautiously," Baur said. "However, we see the situation in the after-sales business in particular as a positive signal that new investments can be made again in the near future."
No matter what, Arburg will remain an independent, family-owned company that is based in Lossburg, Germany, according to Michael Hehl, a managing partner and spokesperson for Arburg's management team.
"At the same time, a sensible degree of internationalization is important if we are to continue, positioning Arburg securely and sustainably for the future, Hehl said. "… We are pursuing a local-to-local strategy and are currently looking into the possibilities of internationalizing various stages of the value chain. Areas of focus in this context include local sourcing and assembly."
For example, the Allrounder line of presses were previously built exclusively in Lossburg, but other assembly sites are being sought in Asia and North America.
"We took an initial step towards a local-to-local approach several years ago with our Arburg Technology Factories, or ATFs for short," Hehl said. "ATFs have been set up in the Czech Republic, at our Chinese location in Pinghu and at our U.S. headquarters in Rocky Hill, Conn. In these factories, Allrounders are tailored to customer-specific requirements and turnkey systems are implemented in cooperation with local mold and peripheral equipment suppliers."
The next step is the assembly of complete machines in China, which began already, followed by North America starting with the Allrounder Golden electric EVO machine in China.
"We haven't yet finalized out plans with regard to the exact location of our assembly operations in North America," Hehl added.