VDMA, the German Woodworking Machinery Trade Association, says it expects machinery production to decline for a third straight year.
VDMA says it expects annual production to fall by about 7 per cent in 2026. Production had already shrunk by single-digit figures in 2025 and 2024 and there are still no signs of a fundamental and sustainable change in the trend, even though order intake grew moderately by 7 per cent in the first four months of 2026.
This positive snapshot includes a number of larger orders, which are not sufficient to bring about a turnaround in production in the current year.
Generally speaking, the primary woodworking machinery sector (sawmill technology and wood-based panel production) has been hit harder by the downturn than the secondary segment, which covers machinery for further processing. Manufacturers whose customers process timber for the construction industry are faring comparatively well. As timber construction continues to gain market share, not only in Europe, there is significantly less reluctance to invest in this sector.
Exports of German woodworking machinery fell by 11 per cent to €2.26 billion in 2025. In the first quarter of 2026, they rose slightly by two per cent compared with the same quarter of the previous year, reaching €570 million. The U.S. ranked first during this period, driven primarily by a major order from the wood-based materials industry. If production facilities for wood-based materials are excluded from the figures, China ranks first, followed by Poland, France and the USA. Markets that performed above average included, alongside Poland, Austria, Lithuania and Italy.
Transformation in a challenging environment
Companies in the sector have so far managed to cope with the low levels of activity quite successfully.
“After three extreme years of the pandemic, we are now in the third year of declining production. These are truly challenging times. Almost all companies in the sector are well on the way to adapting to changing markets – a major achievement. The transformation is in full swing,” said Markus Hüllmann, Chairman of the VDMA Woodworking Machinery Division.
The conditions under which manufacturers operate are changing faster than ever before. It is clear that technological leadership must remain a key criterion for manufacturers. In addition, there is a demand for intelligent automation and logistics solutions.
“And new approaches,” said Dr. Bernhard Dirr, managing director of the Woodworking Machinery Association.
“We must not get lost in the most sophisticated technical details. Customers are interested in whether a technology fits their business model. Whether a machine enables a new product, whether new automation solutions make them faster and more flexible.
“Innovative digital customer solutions, for example, make a difference. Engineering alone is no longer enough. We are seeing across the board that manufacturers are successfully adapting their product ranges, services and business models to the changing environment.”
