Eurozone manufacturing was further hampered by global supply chain issues in October, with the Purchasing Managers’ Index (PMI) for the sector falling to an eight-month low.
Manufacturing PMI, an indicator of improvement or decline in manufacturing sector conditions, fell from 58.6 in September to 58.3 in October, although it remains well above the level of 50 at which growth becomes contraction.
IHS Markit, which publishes the figures, said supply issues had “interrupted production schedules and dented order books, causing growth of both metrics to slow”.
Across the eurozone, the Netherlands, Ireland, Italy and Austria all recorded stronger expansions of 62.5, 62.1, 61.1 and 60.6, respectively.
However, Germany, Spain and France, the countries with the biggest automotive industries, slumped the most, to 57.8, 57.4 and 53.6.
Vehicle production has been particularly impacted in recent months by a lack of parts, largely caused by the global chip shortage.
Supplier delivery times grew to the third-highest levels on record, only beaten by the delays seen in May and June, due to low shipping container availability, transport issues such as a lack of drivers, and widespread shortages of components and raw materials.
This pushed input cost and output price inflation rates to new survey peaks.
Production increased, but the rate of expansion declined to its slowest in the last 16 months.
Meanwhile, new business intakes rose, but at their slowest rate since January.
The report also noted that while business confidence remained above its historical average, the level of positive sentiment had slumped to a one-year low.
Explaining this, Chris Williamson, chief business economist at IHS Markit, said: “Increasing numbers of producers grew concerned about the supply situation and the impact of rising costs and prices, adding to the indications that manufacturers face some challenging months ahead.”
Williamson further commented on today’s figures: “Production constraints at suppliers were reported alongside a growing list of logistical issues. These include a lack of shipping containers and inadequate freight capacity, port congestion, driver shortages and broader transport delays linked mainly to the pandemic.
“These shortages have led to the weakest rise in factory output since the recovery began in July of last year, and also pushed inflationary pressures to new survey highs, raising further questions about just how transitory the recent spike in inflation will be.”