Economic Update - Special Report

Author photo: Stefan Miksch, Naresh Kumar Surepelly, and Florian Güldner
ByStefan Miksch, Naresh Kumar Surepelly, and Florian Güldner
ARC Report Abstract


To be able to provide our Advisory Service clients with holistic coverage of the impacts of the COVID-19 pandemic on various markets, ARC Advisory Group has decided to publish our latest Automation Index and Machinery Index as a consolidated Special Report in PowerPoint format.  This concise report focuses on the quantitative rather than qualitative aspects. ​

We have adopted our CapEx calculations to line up with the machinery and automation indices, but this did not result in significant changes to the overall dynamics.

COVID-19 Pandemic Status: Coronavirus: The Numbers

  • Origin:  China
  • Status quo (Sept 2020):
    • Global – little spread in Africa
    • Spread depends largely on governmental measures
    • No proven vaccines or medications available
    • US, Brazil, and India have emerged as particular hotspots
    • Second wave in selected European countries due to travelling and less strict measurements – more younger people affected
  • Chart shows number of vaccination trials
  • No vaccine available so far, testing in progress
  • Vaccine expected to reach market in mid 2021
    • Source:


  • Chart shows number of daily new infections, indexed to be 100 on the day with the highest number
  • Strategies towards virus:
    • Strict lockdown (Europe, Taiwan, India, Vietnam…)
    • Testing (S. Korea, Singapore)
    • Contact tracing (Japan)
    • Immunity (Netherlands, Sweden)
    • Variable to none (Brazil, UK, US, some emerging economies)



Automation Markets

Automation Index: Raw vs. Seasonally Adjusted Data

  • The direction of the index shows a downward trend for both raw and seasonally adjusted data
  • Both indices show a difference of over 2 percent in Q2 2020 growth rates. The decline is due to the negative impact of COVID-19 pandemic across the globe
  • Automation index saw a downturn since mid 2019.  COVID-19 came in early 2020, resulting in further negative growth rates in the first two quarters of 2020


  • In the Americas, the raw data shows that quarterly YoY development has been negative for a long time
  • The impacts of COVID-19, trade tensions and the recent global lockdowns, badly affected both the oil & gas, and aerospace & defense industries
  • Disruptions in supply chains further impacted electronics, semiconductors and mining segments


  • YoY growth continues to decline further in Q2 2020
  • European automotive and machinery companies saw strong declines. Food & beverage, pharmaceutical and chemical seem to be stable
  • Automotive industry has been experiencing downturn in growth rates since mid-2019 due to transition to electric vehicles and the recent COVID-19 pandemic further impacted the industry hard


  • Markets further declined in Q2 2020 due to downturn of local automotive, semiconductor, and electronics markets due to COVID-19 pandemic and related supply chain disruptions
  • Without COVID-19, electronics & semiconductor would likely have bounced back in Q2 2020
  • China’s economy has seen a speedy recovery from COVID-19 pandemic compared with other nations globally and the market seems to be almost back to normal under increasing pressure to keep up with past production growth
  • Growth impulses also came from South East Asia


Machinery Markets

Machinery Index:  Preface 

economic update


  • ARC typically seasonably adjusts the data in our indices to more accurately show the business cycle, but we did not do so in our last Machinery Index (Q1 2020)
  • Since the seasonably adjusted data now shows a dip in the market, we have returned to our normal practice of seasonably adjusting the raw data for this Q2 2020 Machinery Index
  • Raw data shows a more significant downturn in Q2 2020 than does seasonably adjusted data


Table of Contents

  • COVID-19 Pandemic Update
  • Automation Index
  • Machinery Index
  • End User Index
  • Summary


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