“The industry’s October results are largely similar to those in September. In most industries, production grew. However, problems with the supply of components in car production also began to manifest themselves in related industries, such as tire production, “commented Radek Matějka, Director of the Department of Statistics on Agriculture and Forestry, Industry, Construction and Energy of the CZSO.
Car production fell by a third compared to last October. The production of rubber and plastic products also deteriorated and wood processing also recorded more than a quarter weaker results.
Compared to last year, on the other hand, the production and distribution of electricity, gas and heat was successful, growing by more than 10 percent. The production of machinery and equipment was higher by 6.1 percent, the production of other means of transport and equipment then improved by almost a quarter.
New orders from abroad fell by 4.3 percent year on year in October, while domestic new orders rose by 3.6 percent. “For the second month in a row, the volume of newly contracted industrial orders was lower year-on-year. Here, too, the dominant influence of the automotive industry was supported by a high comparison base in October last year, ”said Veronika Doležalová, Head of the CZSO Industry Statistics Department.
New orders in the automotive industry fell by a fifth. The production of computers and electronic equipment as well as the production of other means of transport also recorded a loss. On the other hand, foundry and metallurgical processing of metals, production of chemical substances and chemical preparations and production of machinery and equipment had more orders.
The second weakest month
According to analysts, the October development of the industry surprised. Precisely because of the problems in the automotive sector, they expected a bigger decline.
“From the point of view of seasonally adjusted industrial production, however, October was the second weakest month this year, right after September. In October, new orders again recorded a slight year-on-year decline, by two percent, “said Miroslav Novák, an analyst at Akcenta.
UniCredit Bank economist Patrik Rožumberský expects the industry to grow for the rest of the year as the situation in the automotive sector and supply chains begins to improve gradually. “In any case, it will be true that industry will not be one of the driving forces of the Czech economy in the final quarter of the year,” he said, warning that growth could be stopped by another wave of the epidemic.
Novák expects that in total this year the industry will grow by over eight percent. However, as the industry showed weaker values last year as well, it does not consider it a brilliant number.