Tuesday, July 26, 2011

Relax its summer

Two "hot" news items have crossed my desk in the last few days, both by coincidence related to news from Germany: one on a positive economic note and the other not.

TRUMPF, the leader in the industrial laser products market, reported a 51% increase in 2010/11 fiscal year sales, with 2.025 billion Euros compared to last year's sales of 1.340 billion Euros. This is the second highest revenue year, only topped by 2007/08 with 2.144 billion Euros. However, bookings were 2.22 billion Euros, topping the 2.15 billion Euros booked in 2007/08. And the frosting on the cake is that profits last year are expected to hit triple digits in the millions, and the company will need to add another 500 jobs worldwide.

The less than auspicious news is that the mighty German manufacturing engine is sputtering, according to two closely watched indices, the Ifo and ZEW monthly reports. Both reports were negative, with analysts titch-titching that “Expectations are clearly weakening.” The blame rests on, of all things, three problems: the budget impasse in the US, a slowdown in the expanding Chinese market, and a drop in German consumer spending. Where have we heard this before?

We are not supposed to get overheated in these “dog days” of summer, the weather forecasters remind us, but most of the US has been posting record high temperatures the past few weeks, thereby driving up our personal heat indices. So I think I’ll head for the lake for a few days to cool off and to savor the great news from TRUMPF and ignore the not-so-good news from the manufacturing front. Relaxation is what summer is made for.

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