Textiles - Upmarket positioning and innovation: Key to the success for the French and European textile industry?
We close the year in our series of economic publications with our third Panorama sector.
You will find in it our usual barometer, which assesses the risks to which companies in fourteen key industrial sectors in emerging Asia, North America and Western Europe are exposed. On top of these evaluations, we provide for each of these major regions a comprehensive overview of developments in distribution, electronics, metals, automotives, pharmaceuticals and services.
What are the significant developments for the last quarter of 2013? In North America we have reclassified automotives and distribution, for which risk has become moderate thanks to robust household consumption. In emerging Asia, the risks linked to services are now moderate too, with business turnover and profitability in this sector rising quite sharply. In contrast, we are maintaining our ratings for all sectors in Western Europe, because, although the overall trend is towards stabilisation, this region remains difficult and highly uncertain.
We have also included an analytical focus on European textiles. This traditional industry was affected very early by globalisation, and, in particular, competition from developing countries. How has it responded? By developing an effective strategy of innovation (in technical textiles) and capitalising on its reputation for know-how and quality. A strategy that has undeniably borne fruit, but can we really talk of sustainable stabilisation? What are the main issues in the years ahead? What risks do businesses face?
Household consumption in North America supports the distribution and automotive sectors, for which risk levels are improving. Emerging Asia, where the services sector has a lower risk profile, is not lagging behind. The situation of these sectors in Western Europe, though difficult, is stabilising.
UPMARKET POSITIONING AND INNOVATION: Key to the success for the French and European textile industry?
In the context of globalisation, the textile industry underwent far-reaching structural changes early on: the process of globalisation led to internationalisation of production processes - very advanced in this sector - and competition from developing countries, which affected European and French businesses. Moreover, successive crises have reduced the demand for textile products. To counter these demand shocks, manufacturers in the sector reviewed their supply strategy in order to emphasise their product differentiation capacity. Innovation was at the core of this reorientation as demonstrated by the investment in technical textiles, which has opened up new markets and shaken up the industry’s traditional image. The textile industry is growing strongly both in volume and employment by shifting firmly towards high tech segmentation and by becoming a leading supplier to the automotive and medical industries.