Manufacturers expect the bleakest three months for factory output since 1980, says the latest CBI survey on prospects going into the New Year.
A massive 56 per cent of firms expect their output to fall over the next three months with just 17 per cent expecting a rise. A negative 42 per cent balance is its worst in almost 30 years.
Fifty-two per cent of respondents say their order books are weaker than usual while only seventeen say theirs has increased. That balance of -35 per cent is better than October though; the balance then was -39.
To add to the despair, export orders, oft-touted as British industry’s saving grace since the credit crunch began, are also now limply withering into the dark depths of depression – 45 per cent say they are below normal.
Ian McCafferty, the CBI’s Chief Economic Adviser, said: “Figures for manufacturing continue to make depressing reading, with output still expected to fall rapidly in the coming months.
“It is worrying that, despite the twenty per cent depreciation in pound sterling over the past year, export orders remain so weak. Our export competitiveness is increasing but many of our key export markets are contracting rapidly.”
Stock levels are also a cause for concern. A +21 per cent balance say they have more than their historical average prompting fears that manufacturers across the board will follow their automotive peers and suspend the lines.
Many large retailers are cutting prices dramatically to try and incite more Christmas sales and this has been reflected by producers – a balance of 18 per cent of large manufacturers will be lowering prices in the next three months.
