Manufacturing Industry Outlook for This Year 'Dark Clouds'... Steel and Semiconductor Sectors Also Facing Challenges

[Asia Economy Sejong=Reporter Dongwoo Lee] Domestic manufacturers forecast that their sales performance this year will be more challenging than last year.

According to the Manufacturing Business Survey Index (BSI) conducted by the Korea Institute for Industrial Economics and Trade on 1,500 manufacturing companies on the 15th, the annual sales outlook BSI for domestic manufacturing this year stood at 93. The BSI uses 100 as the baseline; the closer it is to 200, the more companies expect an improvement in the economy compared to the previous quarter, whereas the closer it is to 0, the more companies anticipate a worsening economic outlook.

By industry type, only the new industry sector (104) exceeded 100, while Information and Communication Technology (ICT, 89), machinery (96), and materials (93) all fell below 100. Additionally, both large companies (94) and small and medium-sized enterprises (94) had sales outlooks below 100, indicating a negative view of expected performance. By sector, only wireless communication devices in the ICT sector (105), bio-health (104), and secondary batteries (105) in the new industry sector exceeded 100. In contrast, most other sectors such as semiconductors (86), steel (86), and textiles (86) fell below 100, suggesting a tougher economic environment this year.

The market condition outlook dropped from 92 in the fourth quarter of last year to 87 in the first quarter of this year, and the sales outlook fell from 95 to 88 during the same period. This indicates that the economy is expected to be more difficult this year than last. Domestic demand (88) and export (92) outlooks have declined for three consecutive quarters. However, facility investment (97) and employment (100) outlooks have slightly turned upward. The first-quarter sales outlook for all types, including new industry (98), machinery (91), materials (91), and ICT (83), remained below 100. Among sectors, only secondary batteries (100) recovered to the baseline, while most others remained below it.

Furthermore, the manufacturing status BSI for the fourth quarter of last year showed that market conditions (86) and sales (88) remained flat compared to the previous quarter, both below the baseline (100). Domestic demand (87) stayed at the previous quarter's level, and notably, exports (88) hit their lowest point in three quarters. Facility investment (97) and employment (99) also fell below the baseline for two consecutive quarters following the previous quarter.

Hyundai Motor Ulsan Plant Production Line