Order books strengthen and output decline eases – CBI Industrial Trends

Manufacturing order books improved for the second consecutive month according to the CBI’s latest Industrial Trends Survey (ITS). Total order books were reported as below “normal” to the least extent since July 2023, with both total and export order books standing above their long-run averages.

Output volumes fell very slightly in the three months to September, at the slowest pace since the three months to July 2025. Manufacturers expect output to fall only marginally in the three months to December. Selling price expectations eased in September and now stand only slightly above the long-run average. Stock adequacy fell compared with August, with the level of inventories seen as just about adequate.

The survey, based on the responses of 234 manufacturers, found:

• Output volumes fell marginally in the three months to September, and at the slowest pace since the quarter to July 2025 (weighted balance of -4%, from -17% in the quarter to August). Manufacturers expect output volumes to fall again in the three months to December, at a slow pace (-6%).
  • Output decreased in 12 out of 17 sub-sectors in the three months to September, with the fall being driven by the metal products, food, drink & tobacco and electronic engineering sub-sectors. Output rose in the motor vehicles & transport equipment, mechanical engineering and chemicals sub-sectors.
• Total order books were reported as below “normal” in September, to the smallest extent since July 2023 (-9%, from -25% in August). Total order books stood above the long-run average (-14%).
• Export order books were also reported as below “normal” in September (-9%, from 0% in August), though were also well above the long-run average (-19%).
• Expectations for average selling price inflation eased in September (+12%, from +22% in August). Expectations for selling price growth remain slightly above the long-run average (+8%).
• Stocks of finished goods were reported as adequate in September (+2%, from +15% in August), but the
  balance stood at its lowest since April 2024 and below the long-run average (+12%).

Cameron Martin, CBI Senior Economist, said:

"There are growing signs that conditions are stabilising for manufacturers, with a marked improvement
in order books for the second consecutive month – taking them to their strongest in more than three years. Output is also now falling only marginally and selling price expectations have eased considerably from the highs seen following the outbreak of conflict in the Middle East.

“While these are encouraging signs, it is still too early to call this a sustained recovery, with manufacturers continuing to face high supply chain, energy and employment costs.

“With the Budget fast approaching, government has an opportunity to build on these tentative signs of stabilisation by giving manufacturers the confidence to invest and grow. Action to remove legacy policy costs from all business electricity bills and raise the employer National Insurance Contribution secondary threshold would help turn this emerging resilience into stronger and more sustained growth.”