Sector-Specific Conditions

WACKER predicts that economic trends in the industries relevant to our business will remain dominated by the impact of geopolitical turbulence in 2026. Sustained high energy prices in Germany and weak demand are likely to translate into lower industrial output overall. Political uncertainty will continue to curb consumption and investment.

Chemical industry still facing challenges

The German Chemical Industry Association (VCI) anticipates sustained price and cost pressure in 2026 and expects business to remain impacted by geoeconomic uncertainties. It predicts that global competition will become even more intense, with Chinese overcapacity in the basic-chemicals sector continuing to exert downward pressure on prices. US tariff policy will further complicate market access. As far as the underlying global trend is concerned, the VCI forecasts moderate growth of 2.3 percent, with regional variations expected to continue in the coming year as well. The VCI expects to see a decline of 0.5 percent for Europe (EU) and growth of 1.5 percent for the US. China looks set to once again report the strongest growth rate of 6.0 percent despite dwindling momentum in the Chinese industrial sector.

In its forecast for Germany, the VCI is predicting stagnation for the chemical-pharmaceutical sector as a whole in 2026. Looking at the chemical industry in isolation, the VCI expects production to decline by 1 percent and sales to decrease by around 2 percent as prices continue to fall. Currency effects, moreover, could weigh on export business. A member survey revealed that one in two companies is reporting insufficient orders, with incoming orders in Germany and elsewhere down by over 20 percent since 2021. According to the VCI’s survey, 20 percent of companies are planning to relocate or temporarily decommission facilities, while 10 percent are considering closing sites down completely. Around 75 percent of companies have adopted cost-cutting programs that are expected to start bearing fruit from 2026 onwards.

The ongoing uncertainty entails risks for WACKER’s chemical divisions, too. The current weaker demand in some sectors, such as the construction and automotive industries, and mounting competitive pressure, particularly from suppliers in Asia, are having a negative impact on business. To counter the tense business situation, WACKER launched a project in the fourth quarter of 2025 to significantly reduce production-related and administrative costs.

Nevertheless, the long-term growth trends for our business remain intact. The strength associated with our broad-based product portfolio has proved its worth during the crises of recent years. We see medium-term growth opportunities in all regions due to innovations arising from today’s megatrends, like the ongoing digital transformation. Rising affluence in emerging economies is likely to bolster our sales further in countries such as China and India, and across Southeast Asia. Mounting demand for sustainable products, too, opens up further growth opportunities for WACKER. WACKER’s portfolio has many high-value products that appeal to new customer groups, spurring stronger demand from our industrial customers. Moreover, part of our product portfolio is used in highly automated, industrial manufacturing processes.

Construction industry expected to recover in 2026

According to forecasts by the market research institute B+L Marktdaten GmbH, the global construction volume is set to increase in 2026. The residential-construction market appears to have bottomed out, and for the first time in years, B+L Marktdaten is predicting global growth of 1.9 percent year over year. Growth will, however, vary from region to region. It is in Asia that the residential-construction volume is tipped to see the biggest growth spurt in comparative terms in 2026. B+L Marktdaten is forecasting solid growth for South America and the Middle East and Africa region, too. Western and eastern Europe will see a positive trend after the challenging previous years. By contrast, B+L expects a downward trend in North America. According to B+L forecasts, construction of new buildings, alongside modernization and renovation, will show comparable growth rates at a global level.

Automotive industry trends expected to vary from region to region

The Association of the German Automotive Industry (VDA) expects to see subdued momentum in international car markets in 2026 and anticipates moderate growth in production units in Europe and China. In Europe, new vehicle registrations are expected to lag well behind the pre-crisis level seen in 2019 despite the increase. In the US, by contrast, production is expected to decline, due in part to cost increases and growing protectionism. The VDA expects electromobility to remain a growth driver in Germany provided that the German government’s planned new subsidy program is implemented swiftly and with clear administrative procedures in 2026. According to the VDA, Germany remains the world’s second-largest production base for electric cars. Passenger-car exports by German manufacturers from German plants are forecast to decline slightly by 1 percent to 3.14 million vehicles in 2026. The VDA predicts that non-German production of German car brands is likely to increase by 1 percent to 9.2 million vehicles. The VDA continues to expect a moderate increase in new car registrations in 2026. The German passenger-car market will therefore not recover significantly in 2026. One of the reasons for this is the overall weak economy.

Semiconductor industry remains a growth market

The World Semiconductor Trade Statistics Organization (WSTS) expects sales in the semiconductor industry to rise by 26 percent in 2026. The WSTS is predicting a global market volume of around US$975 billion. Developments, while positive, are likely to vary considerably from segment to segment. Particularly in the segment for memory, storage and logic chips needed, among other things, for AI applications, growth is still predicted to be in the double-digit percentage range. The WSTS expects this segment to generate sales in excess of US$600 billion in 2026. Other conventional semiconductor segments are likely to report single-digit growth rates. The Semiconductor Equipment and Materials International (SEMI) industry association is predicting 5-percent growth in silicon wafer deliveries for 2026. This strong growth in silicon wafer deliveries is expected to continue beyond 2026 to meet the rising demand for chips to be used in AI applications. In addition, new advanced packaging and high-bandwidth-memory (HBM) applications will deliver a boost in demand for silicon wafers.