Auto production continues to dwindle in Piedmont (-1.7%), as the broader automobile industry grapples with its ongoing crisis.

Industry's Dive in Piemonte: Manufacturing Production Faces Downturn

The industry landscape in Piemonte is facing a rough patch, with manufacturing production dipping by 1.7% between January and March compared to the same period in 2024. This marks the fifth consecutive negative quarter, largely due to global geopolitical uncertainties, potential U.S. tariffs, and deep-rooted crises in key sectors like automotive, particularly transportation (-11.3%), automotive production (-31.1%), and components (-10.5%). However, the aerospace sector manages a 5.5% growth, softening the blow.

Food Sector Bucking the Trend

Most sectors show negative trends, albeit with less severe declines: Electricity and Electronics (-2.7%), Textile (-2%), Mechanics (-1.6%), Metals (-1.1%), Wood and Furniture (-0.8%), Chemicals and Plastics (-0.6%). Surprisingly, the food sector bucked the trend, exhibiting a 1.1% production increase.

At the provincial level, Asti (-3.5%) and Turin (-3.3%) are the major contributors to Piemonte's downturn, while Biella (-0.5%) struggles with textile and apparel troubles. Cuneo (-0.7%) cannot ride on its strong agro-food performance to post positive numbers. On the bright side, Vercelli (+0.3%) and Verbania (+0.1%) are the only provinces with a positive sign, albeit minimal.

Simplification and Investments

Unioncamere Piemonte President, Gian Paolo Coscia, calls for immediate action across four fronts: reducing bureaucracy for businesses, investing in human capital, education, and skills, developing a national energy plan, and bolstering both material and digital connection infrastructures. He emphasizes the importance of modern and efficient networks connecting Piemonte to Italy and Europe to ensure development efforts bear fruit.

Tentative Recovery and Technological Push Needed

While production declines, there are slight signs of recovery. Total orders show an 0.8% increase, driven primarily by foreign orders. Business confidence also improves, with the overall index, although still below the neutrality threshold since mid-2022, gaining ground, reaching 87 points. Companies are showing more optimistic predictions regarding production, orders, and turnover in the short term, bringing expectations back to early 2024 levels.

However, a push on the technological innovation front is necessary. Currently, only 9% of Piemonte's manufacturing companies utilize artificial intelligence, a figure that has accelerated from 2% in Q3 2023 but may not be sufficient for national and international market competitiveness.

Factors Bolstering Food Sector Growth

Supply Chain Management: Focus on the extended supply chain, emphasizing professional equipment, technologies, sustainability, and the ecological transition can lead to more efficient production and innovation.
Gastronomic Excellence: The University of Gastronomic Sciences fosters gastronomic excellence, research, and innovation, supporting the resilience and growth of the food sector.
Market Opportunities and Trade: Despite challenges like tariffs, Italy's wine exports have seen growth. This, coupled with the ability to adapt to market conditions and maintain export volumes, can bolster the broader food industry.
Regional Specialization: Piemonte's focus on high-value agricultural products may help maintain production levels even during economic challenges.

The food sector's resilience in Piemonte can be attributed to strategic supply chain management, gastronomic innovation, market opportunities, and regional specialization in high-value products.

The food sector's increase in production can be accredited to strategic supply chain management, emphasizing professional equipment, technologies, sustainability, and the ecological transition, leading to more efficient production and innovation.
The University of Gastronomic Sciences plays a vital role in fostering gastronomic excellence, research, and innovation, contributing to the resilience and growth of the food sector.
Despite potential tariffs and other challenges, Italy's wine exports have seen growth, which, coupled with the ability to adapt to market conditions and maintain export volumes, can bolster the broader food industry.
Piemonte's focus on high-value agricultural products may help maintain production levels even during economic challenges.

Despite the downturn in manufacturing production in Piemonte, the food sector has shown a surprising resilience, attributable to strategic supply chain management, gastronomic excellence, market opportunities, and regional specialization in high-value products.