The overall economic conditions for the manufacturing industry in Germany and Europe will remain challenging in the medium term. A persistent sideways economic trend and the absence of far-reaching economic policy reform impulses are dampening confidence among manufacturers and retailers. Ongoing geopolitical tensions and the resulting more difficult global trade routes are putting additional pressure on the industry, for example through supply chain disruptions and rising raw material and transport costs. Latent risks also remain due to new international tariff barriers, persistently high energy costs, and the lack of significant bureaucratic and regulatory relief for businesses. Private households are also affected by high energy and basic living costs – further reinforcing their already strong propensity to save. A gradual normalization of purchasing behavior is not expected until 2027, with consumers’ pent-up purchasing power being released successively and deferred purchases being made in addition to regular replacement purchases.

This recovery will be strengthened by a medium-term easing of inflation, which will lead to a partial stabilization of real wages and make postponed purchases feasible again. However, a fundamental shift is taking place in purchasing behavior: The trend toward down-trading – the deliberate switch to entry-level products or promotional goods – is keeping sales volumes stable overall, but not value development. This is counterbalanced by new growth drivers favored by external influences. The advancing climate crisis, for example, has recently triggered a boom in air-conditioning and ventilation solutions that is set to continue. Across large sections of the population, air-conditioning units have evolved from an optional comfort product into necessary infrastructure in the home.

At the same time, consumer psychology in the private sphere is shifting from rational needs fulfillment toward emotional self-presentation. Driven by high-reach social media phenomena such as professionally staged “Morning Routines” or aesthetic “Coffee Corners” on platforms like TikTok and Instagram, consumers are developing a strong, emotionally charged desire for certain lifestyle products. For the feeling of replicating the everyday life of digital role models in their own homes, consumers are willing to invest, in some cases disproportionately. Stylish kitchen appliances or beauty products, for example, are becoming status symbols in urban environments. These micro-specific trend waves primarily serve younger, high-spending target groups and, together with a gradual recovery in traditional consumer segments, form the foundation for the moderate trend reversal of the overall market in 2027 – a development whose detailed facets are analyzed in depth in the individual submarkets.