High cost pressure

Industry

Thomas Bründl, head of injection molding specialist Starlim from Marchtrenk, is Vice President of the Federation of Austrian Industries in Upper Austria.

(Bild: Wenzel Markus)

On Friday, KTM AG and two subsidiaries will file for restructuring - the impending insolvency of the motorcycle manufacturer from Mattighofen (Upper Austria) shows how quickly even leading companies can start to falter. Industrial companies are suffering from a drop in competitiveness and want to see action from politicians, as Thomas Bründl also makes clear.

Full warehouses, increasingly empty order books, high costs, uncertainty - it is this mix that is causing problems for more and more domestic companies. The number of insolvencies is rising across all sectors. On Friday, motorcycle manufacturer KTM will file for insolvency.

"We've been saying for two years that it's going to be tight. In soccer terms, you could say: the first half was lousy, we're 0:4 or even 0:5 down. If we carry on playing like that, it won't work. We have to change something," says Thomas Bründl.

Because KTM boss and President of the Federation of Austrian Industries Stefan Pierer skipped the Advent reception of the Federation of Austrian Industries in Linz, Bründl took the floor as Vice President. The head of silicone processor Starlim spoke about...

• The major challenges: "We basically have three issues: One is the cost issue, which we have incurred via the wage and salary track. In addition, we can't calculate the energy - that's extremely annoying. We also need to finally put an end to bureaucracy. We're constantly being slammed with regulations and have priced ourselves out of the market in many areas in Europe over the last two or three years. Correcting this is a huge task."

• The lack of support from politicians: "The question we are asking ourselves is: 'Who is still making economic policy?' We can't dive through the situation. Because one thing is clear: if Germany is seen as the sick man of Europe, then we are on ventilators or in a coma."

The European automotive industry has problems - and the supplier industry is feeling the full impact. Many companies in Upper Austria are affected.

(Bild: AFP)

If there's one good thing about the current situation, it's that no one can just sit back and say: "Well, it won't be that bad." You can see the impacts and effects every day - across all sectors.

Markus Achleitner, Oberösterreichs Wirtschaftslandesrat, beim Adventempfang der Industriellenvereinigung OÖ

• The government negotiations: "I'm fed up with people looking for compromises. We need a consensus now - and that consensus must be: Austria as a business location must be strengthened with everything we have at our disposal."

• False security and its consequences: "In many areas, we are still trying to talk ourselves out of the situation. If you've followed the last two years, we've always gone in with much higher growth forecasts and then reduced them further and further each quarter. Of course, this has created the impression that things won't be that bad. We'll get through it. Based on the experience of not wanting to lose employees, we said that we wouldn't give up employees because it's difficult to get a good employee back. But at some point, the pain is so great that you have to say: 'Now it's no longer possible': 'It's no longer possible'."

I hope we don't have to get even worse and only then will we have an epiphany.

Thomas Bründl, Geschäftsführer Starlim und Vizepräsident der Industriellenvereinigung Oberösterreich

• The battle for the future: "Companies have to adapt and change in the same way, but we now need a really strong commitment to Austria as a production and industrial location. Then we have the chance to say, okay, the companies are adapting, but at the same time we need a long-term plan including framework conditions, a clear vision that is understood and creates trust."

• International competition: "The others won't wait. They are catching up at breakneck speed. We don't always need to look towards China, we can see that in Europe too. The Spanish, for example, have the second wind, they are doing well. We need a positive boost like that."