Market environment and business development

      The Metal Forming Division delivered clearly positive performance in the business year 2021/22 although the economic environment of the automotive industry, its most important customer segment, was very unfavorable. Key to the good results were those business segments that do not have any supplier relations with the automotive sector at all or only to a smaller degree. Tubes & Sections, Precision Strip as well as Warehouse & Rack Solutions delivered excellent performance, thus making up for the market-related weakness of Automotive Components. The division also benefited from high prices resulting from sharp increases in the cost of input materials, especially steel and aluminum.

      While automotive sales in the European Union had already dropped in calendar year 2020 by about one quarter owing to the economic fallout from the COVID-19 pandemic, new vehicle registrations in calendar year 2021 were even lower. Note, however, that the extremely low sales figures for 2021 do not reflect weak demand but rather stem from supply chain disruptions and associated production cutbacks. The semiconductor supply chain problems that started to affect automotive production in early 2021 intensified during the Northern summer. The upstream suppliers to the original equipment manufactu­rers (OEMs) also had to adjust their production levels. While the semiconductor supply chain crisis eased a bit at the start of calendar year 2022, conditions came to a head yet again toward the end of the business year 2021/22. Deliveries of wire harnesses, a product largely manufactured in Ukraine, declined sharply as a direct consequence of the Ukraine war. These negative developments greatly affected the division’s Automotive Components business segment in the reporting period. Demand from automotive production plants was low overall. In addition, the volatility of order call-ups in tandem with short-term cancellations had a negative impact on this unit’s performance. The market data underscore the difficulties that Automotive Components faces in its business environment. In Germany, the segment’s most important market, automotive production declined in calendar year 2021 for the fifth consecutive year. Initially, the supply chain bottlenecks affected the OEMs in China and North America and hence the suppliers in these regions to a much lower degree. Toward the end of the reporting period, however, supply chain problems increasingly became an issue for automakers in the United States. Intensifying energy shortages affected production at voestalpine’s facility in Shenyang, China, in the Northern fall of calendar year 2021, which led to a governmentally decreed power cut that lasted several days. Toward the end of the business year 2021/22, a comprehensive COVID-19 lockdown in Shenyang forced voestalpine’s plant to shut down for about two weeks. Considered against the backdrop of these clearly challenging conditions, Automotive Components delivered satisfactory performance for the reporting period. The restructurings that were undertaken in previous business years are having an increasingly positive effect on the segment’s performance.

      Tubes & Sections delivered excellent performance in the business year 2021/22. Unusually high prices in tubes and sections resulting from sharply rising pre-materials costs have not yet had a negative impact on demand. Good capacity utilization at the segment’s European production plants was driven by highly satisfactory orders from the agricultural and construction machinery industries. The momentum in both the storage technology and the construction industry was strong as well. While demand in Europe from the solar industry in the reporting period’s first half was still subdued, conditions steadily improved as time wore on. Conditions in the commercial vehicle industry, by contrast, turned a bit for the worse in the business year’s fourth quarter. Recently, deliveries to the truck and trailer industry declined, also because the unit stopped supplying a customer in Russia on account of the Ukraine war. Business in safety-related tube components for the global automotive supplier industry did not rebound even a bit until the second half of the reporting period. The economic momentum in Great Britain continued to accelerate as the year wore on, just as in Continental Europe. Tubes & Sections did very well outside of Europe, too. The segment’s business volume in the United States, for example, rose sharply in the business year 2021/22. voestalpine’s U.S. roll forming and welding facilities reported full capacity utilization particularly in the reporting period’s last quarter. Both the construction industry and storage technology drove the strong demand, while the rebound in aerospace has been weak so far. In Brazil, the unit performed exceedingly well thanks to the prospering solar industry. The agricultural machinery and commercial vehicle industry delivered particularly dynamic performance. In contrast to the slumping national economy, the segment’s Brazilian facilities held their ground throughout the business year 2021/22 thanks to their specific product and sector mix.

      The Precision Strip business segment also delivered highly satisfactory results during the reporting period. Orders for the precision strip technology of voestalpine’s European entities reached all-time highs, particularly those for bimetallic strip used in the sawmill industry. However, the bottlenecks in deliveries of input materials had a potentially adverse effect on the development of business. In the U.S., too, high demand especially for band saw steel filled the order books. In China, solid domestic demand dominated the market environment. In the second half of the business year 2021/22, however, growing problems in intercontinental transportation besides exorbitant increases in the cost of both electricity and natural gas in Europe had a somewhat dampening effect on exports to overseas markets.

      The boom in the Warehouse & Rack Solutions business segment, which is driven especially by the growing trend toward e-commerce, continued unabated in the reporting period. In the past two years, the COVID-19 lockdowns throughout the world boosted the unit’s momentum yet further. Given that orders were at record highs in the business year’s first half, the segment accepted only select new projects during the second half. The availability and/or pricing of pre-materials as well as high freight costs in connection with projects overseas had a potentially dampening effect. On the whole, the Warehouse & Rack Solutions business unit delivered highly satisfactory performance in the business year 2021/22 also.

      The degree of fluctuation in stock prices and currency exchange rates or in prices of consumer goods in comparison to the market.