This year's industry survey of IPV member companies presented a sobering picture. Around 67 per cent of companies complained of a noticeable decline in turnover. IPV Board Spokesman Jens Vonderheid and Managing Director Karsten Hunger provide an insight into the current economic situation in the packaging industry and highlight the difficult competitive conditions in Germany.
IPV Board Spokesman Jens Vonderheid looks at current developments with concern: „The year 2024 is unfortunately a little too relaxed, significantly fewer enquiries and correspondingly fewer orders. And I hear that from many industries in our region.“ Together with IPV Managing Director Karsten Hunger, he analyses the current economic situation in his industry. Karsten Hunger is hopeful: „The economic downturn continues to be reflected in a general reluctance to buy. But at least the bottom seems to have been reached for some time now, Demand is stabilising.“ However, both agree that even a slight deterioration in the framework conditions can immediately jeopardise this trend. The German economy is generally struggling with more difficult competitive conditions. The packaging industry is particularly affected by this.
„One in - one out“ rule is disregarded
The „one in - one out“ rule introduced in 2015, which is intended to curb the escalating bureaucracy of the authorities, is consistently disregarded. For several years now, no effort has been made by politicians to pursue this principle. Politicians briefly showed that things can be done differently during the coronavirus pandemic. Processes were accelerated and liberalised in order to maintain supply chains. Almost all of this has now been reversed and new overregulation has been introduced. With serious consequences for the German economy, Jens Vonderheid, Managing Director of Hera Papierverarbeitung, states from the perspective of an entrepreneur.
„I no longer see us in the situation where we have to be the pioneers in everything. As many countries are not yet following suit with these regulations, we are at a huge competitive disadvantage. The same must apply in Europe: If something is decided, then it really must be decided for all EU countries, at the same time and to the same extent. The number of „industrial flight companies“ to more favourable European countries is already increasing rapidly. And the trend will continue to increase.“
Jens Vonderheid, IPV Board Spokesman and Managing Director of Hera Papierverarbeitung
From the perspective of the IPV a number of sectors are being sacrificed to the forced decarbonisation in Germany. Many regulatory measures give the impression that they were knitted with a hot needle in order to achieve political results as quickly as possible. „In our industry in particular, there are more and more conflicts of objectives in the justifications for legislation, which suggest that long-term overarching planning is no longer taking place,“ says Karsten Hunger.
Energy policy is also location policy
According to the IPV, energy policy also looks particularly difficult. Electricity and gas costs have risen significantly for most manufacturers. Above all Electricity became around 30 per cent more expensive on average, For a few companies, electricity prices have even risen by triple digits. A good portion of the additional costs are still being passed on, but this is a massive hurdle in competition: „We are phasing out nuclear power and others are building new power plants. At the same time, we are importing nuclear power from abroad. Unfortunately, that doesn't fit. We have to pull in the same direction“, says Jens Vonderheid.
„The energy transition is probably technically feasible, but industry in Germany is in direct competition. We therefore need the same financial conditions for energy prices as our neighbouring countries. If this is not the case, companies in all sectors will move away or close down.“
Karsten Hunger, IPV Managing Director
As we know, this development is already taking place. Germany is experiencing the first phases of a massive change. The first closures and relocations are still taking place relatively quietly. However, plans for the next five to ten years are already being made in the background. Once these decisions have been made, many more painful cuts are likely to be felt in the German economy over the next few years. Even from the ranks of our own member companies There are already calls for future investments to be made in other European countries at most., but much more likely worldwide. Another reason is the ongoing shortage of skilled labour in Germany, even if this is certainly not the top priority in the current economic downturn. But here too, an economic upturn will lead directly to problems for one or two companies.
Familiar triad: bureaucracy, costs and a lack of information
Is there currently no chance for companies in the packaging industry in Germany to be competitive? Both agree: yes, they definitely do. Because Innovative flexible packaging has clear advantages when functionality and recyclability are equally fulfilled. Packaging is then sustainable and competitive in the long term and can also utilise its advantages in a functioning circular economy. The resulting conflicts of objectives are the major challenge in research and development. The well-known innovative capacity of German SMEs in particular (still) compensates for some of the hurdles mentioned. But the familiar problems remain: the triad of bureaucracy, costs and a lack of information.
„As long as there is still a widespread belief that „everything is burnt or shipped to Asia anyway“, we still have a lot of educational work ahead of us. These weaknesses However, we must not allow short-sighted regulatory interventions to topple our functioning system. The same applies to the introduction of supposedly „steering“ taxes and levies, which in the end are only intended to stabilise tight budgets, but do not strengthen our circular economy,“ concludes Karsten Hunger. Politicians must create resilient framework conditions so that Germany can compete on an equal footing. For the IPV, one thing is certain: the „boom“ cited by the German government must come. And it must come now!
Source: IPV
