As we head into Q2 for 2021, according to Michael Luz, President and Chief Executive Officer, Viessmann Manufacturing US, the markets in our industry have made a strong turnaround, leading to an optimistic short-term outlook. We continue with our forecast series with major players in the industry. The following is an exclusive Q&A with Luz regarding the economy:
MH: What does the short-term economy look like as it relates to Viessmann?
LUZ: Our short-term outlook for the year is quite optimistic; so far for the first quarter we are trending around 30% higher in revenue in comparison to 2020. We do see a lot of home renovation activity on the residential side driving demand. At the same time, we have not experienced a slowdown in commercial activity this year and right now it is quoting and shipping season in the construction markets.
What do we look at for indicators? We look at trends related to order intake year over year. We look at economic indicators including forecasts on U.S. manufacturing and durable goods wholesaler indices.
MH: How does (has) Viessmann positioned itself from the “fallout” of COVID-19?
LUZ: We expect some levels of normalcy to return to the U.S. and our industry in the second half of this year 2021. Although the pandemic has impacted our sales last year, we have seen a strong rebound that started in Q4 of last year and has continued into the first quarter of this year. Viessmann has not missed a beat supporting its customer base during the pandemic, being available in person where appropriate and needed as well as virtually for technical support, customer training and marketing. As an essential business, our logistics operation has been open continuously through the entire pandemic with all necessary safety protocols in place.
MH: Is the only certainty heading into early 2021 uncertainty? How do you forecast and budget for such uncertainty? (Or is it fairly certain at this point during the pandemic?)
LUZ: As a business we are very much used to operating in an uncertain environment, taking into account many factors that could impact our business starting with raw material prices, potential supply bottlenecks on certain components, potential transportation capacity issues to quickly changing customer preferences. From many years of experience, we take all of those into account and give it our best to produce an accurate forecast. Was it particularly challenging doing this during a once-in-a-generation pandemic? Yes. Did we always get it right? No. Lucky for us and our industry, our markets turned around fairly quickly and have come back strongly.
MH: Without getting overly political, does a change at the presidential level (and congress) change the outlook for your company, if at all? (Infrastructure, regulations, green energy initiatives, etc.)
LUZ: Listening to our economic advisors and their analysis of historical data, federal governments with the same party controlling the White House, the Senate and the House of Representatives have always been phases of solid growth for the U.S. economy. Looking at some of the green initiatives that the current administration is pushing, we are ready for those and very well positioned as a company in the HVAC sector with a vision of “Creating living spaces for generations to come.”