Swiss Manufacturers See Sales Drop Amid Weak European Demand

(Bloomberg) — The Swiss manufacturing sector saw revenues slump in the first half of the year as firms suffer from the strong franc and weak demand in Europe, its most important export market.

Sales dropped by 5.1% from a year earlier, driven by the 8.4% decline in Germany, according to Swissmem, the country’s largest lobbying group for manufacturers in the machinery, electrical engineering and metals industry. 

A slowing automotive industry and high energy costs affecting the northern neighbor have dampened the need for Swiss machines, the group said on Tuesday. Exports to Asia and the US climbed, partially offsetting losses in Europe.

Swissmem does not expect an upturn in the remainder of the year, as a purchasing managers index of manufacturing has remained below the threshold indicating growth since the beginning of 2023.  

“I expect that a trend reversal will begin in 2025,” Swissmem director Stefan Brupbacher said in a statement on Tuesday.

Worries are amplified by continued strength in the Swiss franc, with the haven currency at the highest in almost nine months against the dollar. The association has repeatedly criticized the Swiss National Bank for letting the country’s currency appreciate.

“The strong Swiss franc remains a serious reason to turn away from Switzerland,” Swissmem President Martin Hirzel said. “The SNB’s attention must not let up in this respect.”

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