Market environment and business development

Market environment and business development

The Metal Engineering Division performed well overall in the 2024/25 financial year, supported by its global presence and the positive market conditions in the Railway Systems business segment. In contrast, the Industrial Systems business segment saw varied performance across its product areas.

The good global demand in the Railway Systems segment continued in this reporting period, with only a seasonal slowdown in the second half of the year due to lower construction site activity during the winter months. Despite the overall economic weakness in Europe, the railway infrastructure market remained robust, particularly in the rails product segment, which focuses primarily on European markets. As a result, the Donawitz rail plant in Austria operated at high capacity throughout the financial year.

The turnout systems product segment saw consistently good demand in both the European Union and the UK, with particularly positive developments in Germany and Austria. In North America, the 2024/25 financial year was satisfactory overall. Good demand in the passenger transport (“Transit”) sector helped offset weaker activity in the heavy haul sector (“Class 1”) at times. South America and South Africa also saw favorable developments in heavy haul transport. In Egypt, the first turnout systems from the new joint venture with the Egyptian state railways were successfully delivered in the second half of the year, with promising development. Demand for turnout systems remained solid in Australia and India. In China, following the development of the high-speed rail network in recent years, the market has matured, with current demand focused on maintenance. As a result, delivery volumes in 2024/25 fell short of past exceptional levels but remained satisfactory.

The signaling product segment complements the product portfolio with intelligent digital solutions, including point machine systems, monitoring systems for track and rolling stock, and axle counters. With the launch of the new “zentrak” software platform, voestalpine Railway Systems now offers a fully integrated system for railway asset management. The platform enables real-time tracking and condition monitoring, improving maintenance planning, reducing costs, and increasing track availability. The signaling segment continued its growth trajectory in the 2024/25 financial year and delivered very satisfactory results.

In the Industrial Systems business segment, product performance varied significantly. For example, the wire technology product segment (wire rod and drawn wire), which is heavily focused on Europe, faced persistently difficult market conditions. Demand for wire rod was very subdued in the key customer industries such as automotive, construction, and mechanical engineering. Drawn wire performed better, particularly in specialty segments like shaped wire for the energy industry, special wire for ball bearings and prestressing wire for railroad sleepers. After a solid start, demand in the tubulars product segment weakened significantly over the course of the reporting period. Falling global prices for crude oil and natural gas led to reduced exploration activities, particularly in North America, as well as lower volume requirements and prices for OCTG pipes (oil and gas production pipes). Although market conditions stabilized at the end of the financial year, the US administration’s tariff policy led to renewed uncertainty.

Thanks to its global reach, the welding product segment remained stable at a good level. In Europe, general economic weakness dampened demand for equipment, welding rods and electrodes. North America recorded a somewhat subdued but adequate market trend, while demand in South America declined more sharply. In contrast, business development in Asia, particularly China, was strong, and the growth markets of India, Africa and the Middle East showed solid demand for welding technology products.

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