Germany's machinery and equipment industry recorded a slight decline in exports in the first half of 2026, as geopolitical tensions, US tariff policies and persistently weak demand in China continued to weigh on foreign trade, according to German mechanical engineering industry association VDMA.
German machinery and equipment exports decreased by 0.8 percent year on year in nominal terms to €99.3 billion in the January-June period. On a price-adjusted basis, exports declined by 2.5 percent. Meanwhile, machinery imports increased by 2.2 percent year on year to €47.9 billion.
Strong June performance limits H1 decline
Anke Uhlig, VDMA economic expert, stated that relatively stable export activity in the second quarter, combined with a 6.8 percent year on year increase in June, limited the decline recorded for the first half.
However, geopolitical tensions, US tariff policies and continued weakness in business with China remained significant pressures on the sector.
Exports to China fall 13.8 percent
Germany's machinery exports to the US increased by 0.5 percent year on year in the first half, despite the negative impact of US tariff policy and the strong euro. By contrast, exports to China fell sharply by 13.8 percent, continuing the weakness seen in this market in recent years.
Exports to the European Union increased by 1.3 percent, with the bloc retaining its position as the German machinery industry's largest sales region with a 45.9 percent share of total exports. Among major EU destinations, exports to France increased by 3.6 percent and those to the Netherlands rose by 5.1 percent, while shipments to Italy declined by 0.5 percent. Elsewhere in the EU, Denmark and Sweden recorded particularly strong increases of 22.5 percent and 11.4 percent, respectively. Outside Europe, exports to India rose by 11.1 percent, while shipments to Canada increased by 10 percent.
The US remained Germany's largest individual machinery export market with a 13.1 percent share, followed by China with 7.1 percent and France with 6.9 percent.
Steel and aluminum tariffs weigh on outlook
VDMA expects uncertainty to remain elevated during the second half of 2026. According to the association, US tariffs on steel and aluminum derivatives, as well as the possibility of further tariff measures, are creating additional pressure on business with the US.
Meanwhile, the decline in exports to China, which has continued since 2022, is expected to persist amid weak demand and increasing competitive pressure from Chinese suppliers in international markets.
Within the EU, weak order intake from eurozone countries is also weighing on the outlook.
VDMA stated that further free trade agreements and a more efficient EU single market will be important for German machinery manufacturers seeking to diversify their export markets amid continuing trade and geopolitical uncertainty.
