German Automakers Business at 3-Year High, but Dark Clouds on Horizon

Business for German car manufacturers and their suppliers hits a three-year high in May, but managers are pessimistic about the future - a survey by the Ifo economic institute found.

The survey said the car industry business situation indicator rose to 36.6 points - up from 23.2 points in April and reached its highest level since September 2018.

"Business is still very good at the moment, but the first dark clouds are gathering again, probably because of the chip shortage." said Klaus Wohlrabe - head of Ifo surveys. The indicators for optimism, order backlog, production and export expectations all fell in May, suggesting managers expect demand and output to grow more slowly from here on out.

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