Industry key themes 2026: Industry will grow if you know where to look

Global industrial activity has proven resilient in 2025 in the face of sizeable tariffs and uncertainty related headwinds. Looking ahead, prospects for 2026 appear solid, but we expect industrial performance to remain uneven across regions and sectors. Five themes will shape this outlook:

1. AI investment will drive concentrated growth. Continued strength in AI capex will ensure high-tech goods production remains by far the fastest growing sector in global industry. Downstream, the data centre rollout will continue to boost electricity demand, while output in the telecommunications and data processing and hosting sectors will retain strength.
2. US industry growth to broaden out through 2026. Falling policy uncertainty, healthy profit margins, lower interest rates and positive investment incentives in the One Big Beautiful Bill (OBBA) should pave the way for a broader growth acceleration in US manufacturing later in the year.
3. The Chinese industrial juggernaut will keep chugging along, powered by exports. Chinese industry is increasingly reliant on exports, including high-tech, automotive, and electricals.
4. China’s industrial prowess will come at the expense of other countries. While some parts of emerging Asia, notably Vietnam, should benefit from increasing Chinese industrial activity, other parts will struggle. Europe, most notably Germany, is also very much in the crosshairs.
5. Not all of Europe is in the doldrums, and the weakest links should start recovering in late 2026. While parts of the European industrial core have been weak, driven by export-oriented industries like motor vehicles, others have been performing more strongly.

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