REGIONAL REPORT
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S & P Global reported that Polish manufacturers raised their level of input buying in March to accommodate strengthening new order inflows. Purchases increased for the first time since May 2022, and stocked inputs expanded for the first time in eight months despite faster output growth. There was no evidence of strain on supply chains, however, as input delivery times were broadly stable in March.
“ Growth of output was slightly faster than the increase in new work, resulting in another monthly reduction in backlogs. That said, the rate of depletion was the slowest in the current 34-month sequence of decline. Employment was cut in March, but this followed increases in four of the prior five months,” it explained.
“ With demand for inputs strengthening, cost pressures increased in March. Average input prices rose for the first time in six months and at the fastest
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A view of Warsaw.
Rail infrastructure in Poland. rate in two years, although the
Ensuring productivity convergence recent strength of the zloty continued to tame import prices. can help to sustain growth, said Manufacturers were able to the OECD on 4 February 2025 raise their output prices again, the first back-to-back increases since early-2023. Overall price pressures remained subdued in the context of historic survey data, however, with both seasonally adjusted indices running below their respective long-run averages,” it added.
“ The recovery in the Polish manufacturing sector continued in March as faster growth in output and new orders pushed the headline PMI to the highest in nearly three years. Notably, exports expanded for the first time since early-2022 amid signs of a wider European recovery. This was corroborated by the Flash Eurozone Manufacturing Output Index hitting a 34-month high in March,” commented Trevor Balchin, Economics Director, S & P Global Market Intelligence, on 1 April 2025.
“ With confidence in the outlook reaching the highest in nearly four years, manufacturers boosted purchasing and inventories. The drop in employment in March weighed on overall performance somewhat, but this followed net hiring growth in four of the previous five months. With the backlogs sub-index rising to a 34-month high and approaching the growth threshold, companies may switch back to recruitment mode in the coming months,” he continued.
Geopolitical and market challenges
The automotive sector is a key manufacturing sector in Poland. For example, almost 275,000 cars were produced at Volkswagen Poznań factories in 2024; this is a record result in the company’ s over 30-year history. The Volkswagen Poznań Foundry also produced over 4.3 million components.
However, competitive pressure is forcing car manufacturers to make significant efforts in a climate of decreasing market demand, which will lead to a reduction in production volume in the coming years. Like other sectors globally, the automotive sector in Poland has also been impacted by President Trump’ s global tariffs on U. S. imports.
“ On 3 April 2025, Donald Trump’ s administration-imposed 25 percent tariffs on imports of cars and light trucks into the U. S. went into effect. An additional tax on car parts and computers, including on-board computers, is set to take effect on 3 May 2025,” commented PZPM, the Polish Automotive Industry Association.
“ In response, a meeting was held between representatives of the automotive industry and the authorities. The impact of the new tariffs on the industry and previous crises( COVID, war, raw materials and semiconductor crisis, emission targets) were discussed. It was emphasized that Poland, as a leading parts manufacturer, could indirectly lose up to 320- million euros per year if auto exports to the U. S. fall,” it continued.
Jakub Faryś( PZPM President) has proposed the creation of an inter-ministerial automotive crisis team involving the Ministry of Development and Technology, the Ministry of Finance, the Ministry of Infrastructure, the Ministry of Climate and Environment and the Ministry of Family, Labour and Social Policy, under the auspices of the Prime Minister.
ITM Industry Europe trade show in Poland.
Productivity and innovation
Ensuring productivity convergence can help to sustain growth, said the OECD on
4 February 2025.“ Productivity convergence has been substantial but will gradually slow down. Improving the business environment further, reforming the governance of state-owned enterprises, increasing upskilling and boosting innovation can
46 | ismr. net | ISMR May 2025