The German economy is stuck in a rut. The country’s large, export-dependent manufacturing sector is reeling from the collapse in global trade while problems within domestic industry compound the overall economic malaise, the Financial Times reported. The services sector has held up, but the disconnect is not certain to last much longer — business cycle indicators already point to a mild recession. Benefits from further monetary easing will be constrained by unprofitable banks and vast savings. Fiscal space is abundant. It must finally be used.

Leoni has hired an external adviser to monitor its ongoing restructuring, two sources said on Thursday. Magazine WirtschaftsWoche reported that representatives of Leoni’s creditors had met on Monday to discuss the firm’s liquidity situation, Reuters reported. Leoni has hired Hans-Joachim Ziems as an external expert for the restructuring, the sources told Reuters, adding that Leoni managed to reassure its creditors. Leoni said it was in constructive talks with its creditors but declined to provide details, adding that its lenders supported its saving and strategy scheme.

Industrial production in Germany dropped by a larger-than-expected 1.5 per cent month on month in June, compounding fears that Europe’s largest economy could be heading for its first recession in more than six years, the Financial Times reported. Analysts polled by Reuters had estimated output would fall 0.4 per cent during the month compared with May. The fall meant that industrial production was 5.2 per cent lower than a year ago, Germany’s statistics office said. Carsten Brzeski, ING’s chief economist for Germany, characterised the figures as “devastating, with no silver lining”.

The pace of German expansion slowed more in July than earlier estimates had suggested while businesses’ optimism for future production fell to its lowest in more than four and a half years, a leading indicator’s final figures showed, escalating fears that the eurozone’s biggest economy faces recession in coming months, the Financial Times reported. IHS Markit’s final services reading recorded 54.5, well below a preliminary estimate of 55.4. This was also lower than June’s nine-month high of 55.8, IHS Markit data revealed on Monday. A figure above 50 still indicates growth.

A German group is interested in buying British Steel’s French factory, according to people aware of the situation, even as efforts drag on to prevent a break-up of the stricken company, the Financial Times reported. British Steel collapsed into insolvency more than two months ago after the government rejected its plea for a bailout, throwing into doubt the future of one of the country’s largest manufacturers.

German industrial automation provider Eisenmann SE has filed for insolvency and launched a strategic reorientation plan to help the company return to profitability in a plan that could see some business units sold off, corporate leaders said Monday, DC Velocity reported. Böblingen, Germany-based Eisenmann this week filed its petition for the opening of insolvency at Stuttgart District Court, also submitting applications for the related business units Eisenmann Anlagenbau GmbH & Co. KG, Eisenmann Lactec GmbH, and ENisco GmbH & Co. KG.

Downer EDI Ltd warned on Thursday that it expects a negative impact to its full year 2019 results following the insolvency of Germany’s Senvion SA, the company’s construction partner in the Murra Warra wind farm in Victoria, Reuters reported. Sydney-based Downer said wind turbine manufacturer Senvion’s bankruptcy would result in a charge of A$45 million ($30.83 million) for the full year, related to obligations for completing the wind farm.

German auto supplier Eisenmann, which supplied Tesla in 2015 with a new paint shop at its Freemont plant in California, filed for insolvency late on Monday, in a sign of the growing economic problems crushing profits in the auto sector, Reuters reported. Eisenmann, which has 3,000 employees and generated annual revenues of 723 million euros ($806 million) in 2017, filed for insolvency at the Stuttgart District Court. The Boeblingern, Germany-based company said it was now looking for a strategic partner for its Paint & Assembly, as well as its Application Technology businesses.

Bankrupt German wind turbine manufacturer Senvion has sufficient financing to stay afloat until the end of August, Chief Executive Yves Rannou said at a townhall meeting, according to a person who attended the meeting, Reuters reported. The company is hoping to strike a deal to sell some of its assets but not the whole company by then, Rannou said at the meeting on Tuesday, adding that talks with staff would now start regarding units for which no buyer can be found, the source said.

German car parts maker Leoni has started holding meetings with prospective buyers for its wire and cables division, which it has put on the block in a bid to bolster its cash position, people close to the matter said, Reuters reported. After sending out information packages earlier this month, Leoni’s management is holding informal talks with potential bidders, they said. Preparations for a listing of the unit have been put on the backburner given market conditions, they added.