The VDMA Robotics + Automation Association (VDMA R+A) is voicing concerns about Germany’s robotics industry. The German trade association, which falls under the VDMA umbrella that has 420-plus member companies, said the country’s robotics and automation industry “has lost competitiveness.”
The VDMA R+A forecast that Germany‘s robotics and automation industry will drop 9% in total turnover in 2025 to €13.8 billion ($14.4 billion U.S.). “Total turnover” is the term Germany uses to describe the amount of money a country’s businesses make from sales over a period of time. According to the association, the sector closed with a 6% drop in turnover in 2024 at €15.2 billion ($15.8 billion).
Dietmar Ley, who was named chairman of VDMA R+A in November 2024, cited multiple reasons for the decline.
“The sales trend in the robotics and automation industry calls for action,” he said. “The current downward trend is not based solely on cyclical fluctuations in demand but has very tangible structural causes. These include, for example, the excessive dependence of the robotics and automation industry on the German automotive industry. In addition, there are weaknesses in competitiveness that business and politics must address with consistent reforms.”
VDMA R+A said these structural weaknesses were evident in 2024. It pointed to a 16% decrease domestically compared with 2023.
Growth stimuli from abroad also faltered, showing a decline of 2%. The only bright spot for the German robotics and automation industry was exports to the eurozone, with incoming orders rising by an impressive 44% in 2024, noted VDMA. The eurozone is a currency union of 20 member states of the European Union that have adopted the euro as their primary currency.
By contrast, the Frankfurt, Germany-based organization said foreign demand excluding the eurozone countries was 13% below the previous year’s figure.
“Companies in the German robotics and automation industry need to focus on their own competitiveness,” stated Ley. “The priority is to accelerate innovation. More agility is also needed to respond more quickly to customer demands and to set ourselves apart from competitors abroad. Finally, we also need to bring costs down to a competitive level.”
In June 2024, the VDMA warned that growing competition from China was weighing on its own robotics ecosystem. “Many Chinese suppliers have grown strongly in their home markets and are now pushing into Europe,” the group said at the time.
VDMA chair calls for reforms
Ley also called for a determined reform agenda from politicians.
“With a view to fierce global competition, Germany can no longer afford disadvantages such as disproportionate regulation and excessive costs,” he asserted. “The economy needs reliable framework conditions in Germany that support, not hamper, growth. Only then robotics and automation could thrive again.”
“All long-term growth trends for our innovative industry remain intact. We now have to set the right course,” Ley stressed.
Germany is not alone in robotics slowdown
A3 said industrial robot sales were flat in North America in 2024. Credit: Steve Crowe
Germany isn’t the only country to see its leading robotics industry see a slowdown. China, the world’s largest industrial robotics market for 10-plus years, expected its industrial robot sales to decline for the first time in five years in 2024.
The country’s total industrial robot deliveries reached an estimated 300,000 units, down 5% from 2023, according to Shenzhen Gaogong Industrial Institute (GGII). The GGII said the decline was due to the “obviously tightening demand” from the manufacturing industry, especially the automotive and renewable energy sectors.
After record back-to-back years in 2021 and 2022 during the height of the COVID-19 pandemic, industrial robot sales in North America saw a significant decline in 2023 and essentially flat growth in 2024, according to the Association for Advancing Automation (A3). At the recent A3 Business Forum, the trade organization said it expects industrial robot sales in North America to have a slow start to the year before rebounding in the second half of 2025.
Jeff Burnstein, president of A3, recently wrote an open letter to President-elect Donald Trump, saying automation is key to reshoring manufacturing to the U.S. Burnstein recommended that the federal government work with the robotics industry to develop a strategy to effectively compete economically and for national security. This message was re-iterated several times at the A3 Business Forum.
It will be interesting to read the International Federation of Robotics’ (IFR) “World Robotics” report when it becomes available later this year. The annual report dives into the number of industrial robots operating in factories around the world.
For 2023, the IFR said there were 4,281,585 robots operating in factories worldwide, which was a 10% increase from 2022. By region, 70% of all newly deployed robots in 2023 were installed in Asia, 17% in Europe, and 10% in the Americas.
Credit: IFR “World Robotics Report 2024”
VDMA is claiming a decline of the German R&A industry, that is probably nit just the bobotics segment as indicated by the title! Also, it seems to be worthwhile to explicitly comment on the fact that according to the IFR chart, Germany is the only one of the 5 top markets, where teh robot installations are in fact growing!