Out of Time? | Q2/2018 FINANCE Magazine Insolvency Report: Crisis continues for car dealerships and paper mills
Since 2012, there has only been a single quarter with fewer insolvencies than this spring. In some troubled industries, however, the situation is worsening appreciably.
Thanks to the strong economic climate, the major-insolvency tally in Germany has decreased. Although 2017 still brought a significant increase of almost 50% over the previous year, the number of large companies going out of business during the second quarter of this year was the lowest it had been since Germany’s ESUG bankruptcy reforms were introduced in 2012.
Nonetheless, there is a persistent rising tide of crisis cases in some sectors. Once again, car dealership chains, energy suppliers and furniture retailers accounted for much of this trend in the spring quarter, with three businesses in each category going bust, along with two more paper mills. With the exception of car dealerships, the crisis-ridden sectors are suffering from rising prices for energy and raw materials.
The quarter’s biggest insolvency cases included Zanders, a paper mill generating €96.5 million in revenue and employing nearly 500 people, and machine tool manufacturer SHW, whose 240 staff generated €47 million in revenue.