The ferrous and non-ferrous castings market in Europe: Germany and Italy compared
While waiting to receive the annual CAEF report “The European Foundry Industry in 2023” which provides a complete overview of the European foundry industry, in this section we anticipate a brief focus between the two most important European producers of ferrous and non-ferrous castings: Germany and Italy, taking advantage of some statistical previews from the German association “Bundesverband der Deutschen Gießerei-Industrie” (BDG).
The production of foundries in Italy and Germany: structural characteristics
With more than 1,400 companies, approximately 91,000 employees, a production volume of 5.7 million tons and a turnover of 21.6 billion euros, the foundries in Italy and Germany together account for 40% of the production of castings in Europe and occupy a prominent position at the international level.
The two production systems are also closely interconnected: German producers, who source a wide range of high-quality parts and components from Italy for the automotive and mechanical sectors (engine components, transmissions, hydraulics, etc.) are among Italy's most important customers.
From the point of view of the main structural characteristics of the foundry industry, Germany and Italy present substantial differences. The production fabric of the Italian foundry is made up of a number of units of around 900 companies, while the German one has about half of that. In terms of the workforce employed, however, the German foundry has almost three times the Italian one. As a direct consequence of these two peculiarities, the average size of German foundries measured as the ratio of number of employees/number of companies, as a general figure, is more than five times the Italian reality, with marked differences between the ferrous and non-ferrous sectors. The German foundry is predominantly structured as a medium-sized company with the typicality of family management:
- About 91% of companies employ up to 500 workers;
- The largest companies, with over 500 workers, represent 9% of the total industry.
The Italian foundry industry, on the other hand, is characterized by the prevalence of micro and small enterprises:
- 53% of foundries have fewer than 10 workers;
- 37% of companies belong to the class between 10 and 49 workers;
- 10% are between 50 and 250 workers;
- Only 0.8% have over 250 workers.
With respect to the distribution of foundries among the types of alloys, Italy presents a more marked imbalance towards the production of non-ferrous castings, about 82% of the total, while for Germany there is a greater balance (59%). The situation is reversed if we analyze the output of the two sectors in terms of tons. In fact, in the production mix, between the two countries, Italy has a better balance, respectively 56% ferrous alloys and 44% non-ferrous alloys. For Germany, however, there is a heavy imbalance in favor of ferrous metals: 78%.
Characteristics of the productivity of foundries in Italy and Germany
Analyzing the data, the German foundry is represented by a size substantially double for its almost four million tons per year compared to the Italian one.
With regard to the ferrous metal foundry sector, in terms of combination between size and average production per company, the German foundry distances itself significantly from the Italian one with the following values respectively: 158 employees and approximately 13,800 tons of ferrous castings per company. Italy has an average size of 57 employees, while in terms of average production of ferrous castings, Italy records approximately 6,500 tons.
In the case of average production per employee, the situation is reversed and the ferrous castings sector in Italy expresses a value equal to 113 tons per employee, while Germany stops at 87 tons.
Even on the non-ferrous front, there is an abysmal distance between the average size of German foundries (101 employees per company) and Italian ones (19 employees per company). With respect to the average production per non-ferrous foundry, Italy remains at the bottom of the class with around 1,100 tonnes, while Germany exceeds 2,500 tonnes.
Finally, the productivity per employee in the non-ferrous sector rewards Italy with 59 tonnes, while in this case the productivity of Germany drops by around half with 26 tonnes per employee.
In summary, the average size of German foundries is significantly higher than that of Italy in both the ferrous and non-ferrous castings sectors. The evaluation of the average production changes significantly if one looks at it from the perspective of employees or if one bases it on the number of foundries. In the latter case, the German superiority is very evident for both sectors, while the productivity per employee assumes decidedly better values for the Italian foundry.
Total production of ferrous and non-ferrous castings in Europe
The 2023 financial statements show a general sectoral picture between the two foundry industries, which is generally similar in terms of sign, but with some differences in the extent of the variations recorded between the types of ferrous and non-ferrous alloys.
In 2023, the overall production of castings (ferrous and non-ferrous) for Germany was 3.9 million tonnes, -2% compared to the previous year.
Also at a global level, the decline reported by the Italian foundry industry was less than half with -0.6%, while the tonnes produced stopped at around 1.9 million.
The output of ferrous castings (cast iron and steel) in Germany stood at 3 million tonnes, with a trend decline of -3%, while for Italy it was less than -2% (-1.8%).
The gap in results between Italy and Germany is more evident in the non-ferrous alloys sector: +3% for Germany and around 1% for Italy.
Within the ferrous metals sector, the opposite dynamics of steel foundries stands out: the Italian production of steel castings closed 2023 with growth of more than +3%, while the German one with a double-digit loss and more than -18% in terms of volumes.
Source: In Fonderia – ll magazine dell’industria fusoria italiana