Dutch manufacturing has slipped back into stagnation after a short-lived rebound in early 2025, according to ING's latest industry analysis. For the third consecutive year, no production growth is expected, with high energy costs, trade uncertainty and geopolitical tensions continuing to weigh heavily on one of Europe's most export-driven economies.
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The temporary uptick in production, driven by "frontloading" ahead of anticipated US tariffs, has already faded. 'The continuing uncertainty over US import tariffs is detrimental to producer and consumer confidence, dampening global trade growth and weakening demand for Dutch goods,' ING notes. Although tariff hikes were postponed beyond the 9 July deadline, their spectre looms large.
The Netherlands' interior and furniture export sector, tightly linked to industrial production and transatlantic trade, is exposed. The US, while accounting for only 7% of Dutch exports, has been a key growth market for machinery, metal products, and equipment, categories closely tied to B2B interior manufacturing and fit-out services.
The pharmaceutical sector saw a dramatic 30% production rise in Q1 2025, largely due to exports to the US. 'Shipments of medicines and other medicinal products quadrupled year-on-year and were almost 1.5 times higher than in the fourth quarter of 2024.' However, ING cautions: 'First-quarter growth is not expected to set the tone for the remainder of the year.'
Imports from the US dropped by 20% in April alone, following a 25% levy increase on steel and aluminium and continued 10–25% duties on categories like trucks and machinery. 'For manufacturing, this would also mean additional pressure on demand for goods from the US,' ING warns. 'The sector will be hit hard by persistently high US tariffs.'
Despite headwinds, some bright spots are emerging. ING highlights sharply increasing European defence spending and large-scale German investments in infrastructure and digitalisation. 'Dutch manufacturing is well-positioned to capitalise on the renewed momentum of its most important trading partner.'
The Netherlands' defence sector, though still small, is gaining strategic weight. 'If defence spending rises to 3.5% of GDP, the sector could then expand to over €16 billion… representing about 3.4% of total industry output.' ING concludes: 'Despite the strong headwinds this year, the upward trend is therefore within reach for the sector.'
For Europe's interior, furniture and design manufacturers, the message is clear: brace for a turbulent 2025, but keep one eye on emerging opportunities from German capital investments and long-term defence commitments.
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