Research : Machine Tool Orders Pick Up in July

Sep 25, 2018

While IMTS should cause the annual rate of growth to accelerate again, the trend in the GBI: Metalworking index shows that the rate of growth in machine tool orders will likely peak in early 2019.

After a slow June, machine tool orders picked up in July, increasing 7.9 percent, which is somewhat unusual in the run-up to IMTS. Orders stayed just above 2,000 units, which is the baseline for a healthy machine tool market. Contrast this development with the 1.7-percent contraction in June. Despite the return to growth, the annual rate of growth decelerated for the third month in a row. However, IMTS should accelerate the annual rate of growth.

Real dollar orders were $375,960,000, which was the lowest total since February, but July’s dollar orders were up 15.0 percent compared with one year ago. While the annual rate of change has slowed the last two months, dollar orders have held onto a faster growth rate better than unit orders.

The average price of a machine was above the long-term average for the third time in four months. The one-month rate of change in the average price increased for the third month in a row, the sixth time in seven months, which is a sign that the demand for machine tools is outpacing the supply. Based on Gardner’s annual capital spending report, that trend is likely to continue through next year.

Source: Gardner Intelligence