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General Information on cost development 2019

Osnabrück, Oktober 2018

To whom it may concern

Based on recent cost developments and its outlook for 2019 we would like to inform that mayor influencing cost items in our production units will experience significant increases. In detail these are:

  • the increased labour cost based on the high bargaining agreement of the metal and electrical industry in 2018;
  • the significant increase of energy quotes for 2019 based on the development in the energy markets. Electricity prices have risen by 32% since the beginning of 2018; gas prices increased in the same period by 26%. Both cost items represent an important cost position for our production process;
  • the increased energy and oil costs and the decided change in toll fees for Germany will determine a further significant increase in transportation costs for 2019.

We will as usual concentrate on increasing our efficiency in production processes and strongly focus on mitigating this negative development for our business partners.

Despite of our ongoing efforts to remain utmost competitive we are now also forced to implement price increases and change our metal and processing conditions for all product lines.

 

We kindly ask for your understanding for these essential measures.

 

KME AG

The Executive Board