Another drop in industrial production in France in October

Is this already the consequence of the energy savings made by manufacturers in anticipation of winter and because of the prices of electricity and gas which are still at their highest? It is at least a generalized movement that we observe, this Friday, with regard to the figures for industrial production in France. This fell by 2.6% in October over one month, according to the National Institute of Statistics and Economic Studies (Insee).

It’s not the first time she’s fallen. In September, it had already recorded a decline of 0.9. A figure also revised downwards by INSEE which had announced, initially, 0.8%. The fall in manufacturing production in September is also revised downwards by 0.1 percentage point, to -0.5%.

These October figures are explained by a drop in production « in all major branches »advanced INSEE, which underlines in particular the fall in the extractive industries, energy and water (-5.6% in October, after 2.8% in September) and the heavy « chute » in coking-refining (-46.3% after -6.5%), « because of the strike movement which affected the refineries ». This sector has indeed experienced a vast strike movement started on September 27 and which paralyzed a large part of its activity for more than a month.

In the field of transport equipment, production fell again (-1.9% after -3.2%). More particularly, it fell in the automobile sector (-5.8%, as in September) but « bounces in other transport equipment » (+1.3% after -1.0%). This led to a further drop in manufacturing production in October of 2.0% (-0.5% in September), a far cry from the upturn in August, which had seen it increase by 3.0%. However, manufacturing production for the last quarter (August to October 2022) remains « 2.4% higher than the same three months of the previous year », underlines the INSEE. For industry as a whole, however, it remains stable, « due to the drop in energy production ».

Automobile: sales up for the fourth consecutive month, still far from pre-crisis levels

Better results over the year

The results taken over one year also allow us to draw a positive conclusion. Production is, in fact, in « sharp rise » in transport equipment (+11.4%), particularly in the automotive industry (+26.8%), « less affected than a year ago by difficulties in the supply of electronic components, even if these persist », details INSEE. Production also increased in capital goods (+4.0%) and in coking-refining (+3.9%).

On the other hand, production fell sharply in the extractive industries, energy, water (-12.2%), « mainly due to the decline in electricity production ». Finally, it decreased slightly in the food industries (-0.4%).

The United States worries Europe with its Inflation Reduction Act

The French president began a three-day state visit to the United States on Wednesday where he met the American president. The objective: to tackle the sensitive issue of the Inflation Reduction Act (IRA). This massive plan provides nearly 400 billion dollars in aid for the relocation to American soil of industries of the future: electric cars, batteries and renewable energies. These cascading subsidies make Europe fear a distortion of competition and an exodus of its industrialists to the other side of the Atlantic.

“We have agreed to discuss practical ways to synchronize our approaches to strengthen supply chain, production and innovation on both sides of the Atlantic”, assured Joe Biden during a joint press conference at the White House. However, there is little chance of seeing Washington touch its IRAa very popular text in certain American states considered as key and which is intended to be one of the markers of the mandate of the Democratic president.

(With AFP)